COVID-19 has drastically impacted nearly every person's finance across the world. While some banks have shown leniency, it might only be temporary, and eventually you will want to take steps to improve your credit when you are back on your feet financially.
Here are a few tips on how you can improve your credit as the world works to recover from the impacts of this virus.
- Reach out to any creditor you are in debt with. Most companies are showing a willingness to work with people affected by COVID-19. You might be able to extend due dates, and you can ask creditors to delay in reporting any delinquencies to the credit bureaus.
- Work with utility companies to inquire about budget billing. As summer approaches, you might be able to even out a bill like the electrical bill, so you are not paying high rates during summer when you will run the A/C a lot.
- Focus on paying down any high interest debt first that you may have occurred as a result of the impacts of COVID-19. If you cannot pay the high interest debt down immediately, reach out to the creditor to inquire about lowering the interest rate. If that does not work, try applying for a credit card that has no interest on transfers for a year. You can transfer debt with a high interest rate to a credit card with low (0%) interest while you aggressively work to pay it down.
- Look to downsize expenses if you can. If you have a car loan on a newer vehicle, you can consider trading that vehicle in for a less expensive model, which will lower the amount of money you owe.
- Consider alternate living arrangements. Perhaps you are struggling to pay the rent, and you might be able to consider moving in with friends or family to lower your monthly expenses while the economy recovers and you are able to improve your income.
- If you have a mortgage, reach out to the lender. Many mortgage companies are allowing mortgage deferrals for 3-6 months depending on how much your job and income were affected by the virus. There are federal rules in place to help you.
Remember that this virus has affected the entire global economy. You are not in this alone, and there are ways for you to get help in improving your credit. For any additional questions on improving your credit, reach out us.