BBB Tip of the Week: Protecting personal finances in a time of crisis
Personal finances are an especially sensitive source of anxiety right now. The economic fallout of the coronavirus pandemic is causing understandable concern for households in the Inland Northwest needing to cover basic monthly expenses, including upcoming debt payments.
As worries mount, unfortunately, so can the risk of inflicting long-term damage to your credit score.
Now more than ever, it is more important for consumers to know their options and take the steps available for managing their debt. Lenders are continually creating additional opportunities to help borrowers experiencing financial difficulties right now. Many are offering forbearance, loan extensions, a reduction in interest rates or other forms of flexible relief.
Going forward with one of these repayment options should be done only if the appropriate precautions are taken. For one, make sure to secure written documentation of any arrangement worked out with your financial institution. Confirm those repayment efforts are reflected in your credit reports, too. Monitoring those reports can be done for free through each of the three major credit bureaus.
Managing debt safely and fairly should be a priority for every consumer, especially right now. Better Business Bureau Northwest and Pacific recommends these tips for protecting your credit during an anxious time.
Get things done the “write” way. In addition to providing documentation of any repayment arrangements, debt collectors are legally required to provide a written “validation notice” of debt. The information in that notice details the amount of debt owed, the name of the creditor and an account of the borrower’s rights.
Dig into the details. Scammers surface any time consumers need help. As the pandemic continues, a growing number of bad actors are posing as debt collectors so they can steal valuable personal information. Spotting these frauds can be as easy as asking for details like their name, company, street address and telephone number. Legitimate debt collectors will have answers to any questions about an account.
Know what is free versus what has a fee. The only legitimate website that offers a truly free credit report through the three major credit bureaus is AnnualCreditReport.com. Other sites claiming to offer “free” reports may ultimately include some type of fee deep within the fine print. Use those sites at your own risk.
Report any wrongdoing. If you feel a debt collector has acted unfairly or has failed to meet specified legal requirements, report your experience at BBB.org. Other outlets for filing a complaint include the Washington state Office of the Attorney General, the Federal Trade Commission and the Consumer Financial Protection Bureau. Sharing your experience may prevent others from encountering the same issue.
More tips and information for helping both business owners and consumers during the coronavirus pandemic is available at