WASHINGTON — April 1 brings some tough challenges for locals looking to pay their rent and mortgages amid the coronavirus crisis.
On March 26, the U.S. Department Bureau of Labor Statistics revealed more than 100,000 people filed unemployment claims between Maryland, D.C. and Virginia from March 14 through March 21.
With more people in our region short on cash, WUSA9 reached out to Jack Gillis, executive director for the Consumer Federation of America, about how to best handle mortgage and rent payments.
"This is a huge problem for the average consumer, because let's face it, our financial well-being plays a major role in our physical well-being," Gillis said. "So, if we're worried and anxious about paying our mortgage, paying our car loans, paying our rent, it can have a detrimental effect on our overall attitude."
CONTACT THE PEOPLE YOU OWE IMMEDIATELY
Gillis said the first thing people, who are concerned about their financial stability should do, is make a list of all the payments they owe, and then contact their landlord or mortgage company immediately.
"That's the most important thing consumers can do to protect themselves and to get the benefits many of these folks are offering in terms of forbearance," he said.
Gillis said whether the communication is by letter, email or phone call, just make sure to contact the people you owe as quickly as possible. After that, keep a record of what happened during your correspondence, he said.
"If they offered for you to skip a rent payment, make sure to find out who made that offer and when they made it," he said.
PAY SOMETHING NOW
While you may not be able to pay your rent or mortgage in full now, that does not mean you should forgo your payment altogether, according to Gillis. He recommends offering to pay your landlord or mortgage company a partial payment in the interim.
"This will end at some point in the future, and you will owe the money," he said. "So, the more you can pay, even if it's not the full amount to your landlord, or for your mortgage or for your auto loan, the better off you're going to be at the end of the process."
CONTACT YOUR BANK
Gillis said taking out a loan might offer a short-term solution for people facing rent or mortgage troubles, too. He said people should contact their banks to see if they are offering any help.
"Many banks are giving low or no-interest loans on a short-term basis to consumers," Gillis said. "Contact your utility company and see if there is some forbearance there. The key is don't get yourself too far in debt without contacting the folks that you owe the money to. Most companies today are offering some sort of benefits, but you'll only get them if you ask for them."
Gillis said you may even want to consider borrowing from a 401K account if you have one.
"That can be a way to get through the next couple of months," he said.
There is a little bit of good news out there for people who are worried about making their rent and mortgage payments on April 1. Maryland, D.C. and Virginia have all taken actions to temporarily suspend evictions for homeowners and tenants affected by the coronavirus.