Creditors Approach to the COVID-19 Crisis FAQ
Policies are changing every day, please contact us to discuss solutions for your situation. 561-264-6892 or [email protected]
Personal Debt Questions:
- Can I skip my rent payment? This will be up to your landlord. Often times, the landlord has to continue to pay the mortgage. So, the landlord will still look for rent payments. Recently, the federal agencies, Fannie Mae and Freddie Mac, offered to freeze mortgage payments for owners of multifamily properties if they agree to stop the eviction process during the COVID-19 pandemic. This should slow down the eviction process for loans guaranteed by the government. Be careful, most landlords do not have loans with Fannie Mae or Freddie Mac and this applies only to apartment complexes. If your landlord is threatening eviction, please call today to discuss your options.
- Can I skip my mortgage payment? When South Florida was devastated by hurricanes, mortgage companies offered to “defer” payments for 90 days. This was not a forgiveness of the payment, but required borrowers to come up with the deferred payments over a period of time. Sometimes, allowing one year to make up the payments. Just be aware that you will be required to make up the deferment of payments after this COVID-19 crisis passes. Check your lender’s website to see what assistance options may be available to you based on your circumstances. If you are too far behind on your mortgage and think you cannot catch up, contact us to discuss your options.
- I am behind on my car payments, what should I do to avoid my car getting repossessed? Each car lender will take its own approach. Some creditors have already started to allowing payments to be deferred for up to 120 days due to the Coronavirus. They are not charging late fees but interest will continue to accrue. We recommend that you let them know you are deferring the payments. Do not merely skip payments without requesting to defer them. If you are in fear of losing your car, contact us to discuss solutions before your car gets repossessed.
- What will happen if I skip my credit card payment? There are no programs in place at this time, but due to the Coronavirus, credit card companies are evaluating the situation and some are waiving late fees. While late fees may be waived, interest may continue to accrue resulting in a higher amount due than if you made payments. In the meantime, you should attempt to make minimum payments. Check your creditor’s website for more information. If your credit card debt is unmanageable, contact us today to discuss your options.
- I’m already in chapter 13 bankruptcy, do I have to make my plan payments: Consult your attorney on this question. The Senate passed a bill on March 26, 2020, that permitted confirmed cases to be extended for a period of 84 months. Additionally, the Trustee for Broward and Palm Beach counties recently announced that the Trustee will not file motions to dismiss cases that are behind. Talk to your attorney, if you have one, about how you can modify your plan payments.
- I’m already in foreclosure, what is going to happen? Some courts have suspended foreclosure sales until May 1, 2020. Any sales that were scheduled to take place before that date are being rescheduled. Likewise, the courts are not hearing any matters that require testimony. Motions will still be heard telephonically but trials are suspended indefinitely. Consequently, orders setting sales will not be entered unless a motion for summary judgment is granted. If you want to discuss solutions to save your home, contact us as soon as possible.
- Should I use my retirement to pay my debts? This is a personally decision that must be weighed strategically. If you are struggling to pay food, power, and living expenses, retirement savings should be considered. If you are seeking to use those funds to pay debts, you should give it a lot of thought. In Florida, those funds are protected and not reachable by creditors.
I have a business, is there any relief? The SBA is offering relief that must be applied for directly. There are Disaster Loans and Bridge Loans available. With the new stimulus package, there is some relief to businesses that already have a loan, with the SBA paying the principal and interest for six months. We are available for consultation for any business owners unable to make payments to their creditors.
If the COVID-19 crisis has affected you or your business and your ability to make payments on your debts, and you would like to discuss how bankruptcy could help you, please contact our office to speak with a Bankruptcy Attorney today. 561-264-6892 or [email protected]. We are available for teleconferences.