5 Quick Tips to Navigate Financial Uncertainty

With the Coronavirus pandemic causing many workers to lose hours, it’s more important than ever to know what financial options you have. Here, TLC Loans gives some tips on how everyday people can cope with the financial uncertainty.

If you don’t have an emergency fund and are struggling to make ends meet during these uncertain times, you’re not alone. Almost 80% of workers live paycheck to paycheck and many households say it would be difficult to cover an unexpected $400 expense. Losing shifts or being laid off during this time could exacerbate many Americans’ already precarious financial situations.

This is an incredibly difficult time and we know you’re being hit with a lot of information right now. So we’ve tried to keep this brief – here’s five things to think about over the coming weeks.

1. Contact Creditors

If you’re concerned it will be a struggle to pay your credit card balance, student loan debt or utilities in the coming months, the National Consumer Law Center advises contacting your creditors as soon as possible and asking for hardship concessions. This could include putting payments into forbearance (which should be a last resort as interest still accumulates) or making interest-only payments.

Banks including Capital One, Chase, Citi and Wells Fargo are encouraging their customers facing economic hardship to contact them to see what they can work out. Credit unions are also offering assistance and loan help. Additionally, you may be able to sign up for a hardship plan, which could mean lower interest rates or smaller fees and penalties for a time.

Many utility companies, including major providers such as ComEdDuke EnergyFirstEnergy and PSE&G, offer energy bill assistance programs which may allow you to defer payments until a later date. If you have student loans, contact your servicer to see what your options are.

2. Consider a Personal Loan

A personal loan can help out in times of income insecurity. Banks, credit unions and online lenders like TLC Loans offer them. You will want to research what different lenders offer to compare interest rates and other loan terms. If you have a relationship with a bank already, it may be able to offer you more competitive terms. If you don’t have a good relationship with your bank, an online personal installment loan may be best for you. AT TLC, we specialize in helping people seeking a personal loan who are turned away by traditional banks. (See more below).

You might also be able to access a home equity line of credit and borrow against the value of your home if you own. But know that there are potential downsides to this strategy, including upfront costs and potentially high interest rates if you don’t have a good credit score.

3. Understand what you’re paying in interest across your products.

If you don’t qualify for a personal or home equity loan, you may need to use a credit card where you might be able to save money by moving debt to lower interest products you already have. One option: Look for low-interest offers, whether that’s a credit card or a line of credit with a 0% APY for a certain time period (typically 12 or 18 months).

That will give you some breathing room if you have trouble meeting your financial obligations in the weeks to come. Again, people with higher credit scores will qualify for better deals, so if you have a low score, use the cards you already have before applying for a new card and possibly being denied.

4. Ask for Help

Some lenders are offering payment breaks to help people out so if you need some relief on your debt, contact them. Start with the most expensive debt – the highest interest rate – and work your way down.

What’s more, the government is currently working to implement policies to help cash-strapped Americans during the crisis. But there are already plenty of other resources offered by communities and local and state governments across the country:

If you can’t work because of COVID-19, here’s where you should go to file for unemployment by state: Illinois   Utah   Wisconsin   South Carolina  Missouri

5. Avoid Payday Loans

Last but not least, just say NO to Payday loans!

These loans are easy to get and can be helpful in times of extreme financial duress, but they are incredibly expensive. Payday loans charge extremely high-interest for immediate short-term credit, as the finance charge can range from $10 to $30 for every $100 borrowed. A typical two-week payday loan with a $15 per $100 fee equates to an annual percentage rate (APR) of between 400% and 5,000%.

These are also highly predatory and can keep lendees in a debt trap. They are structured to be paid off in one lump sum, typically within two to four weeks after they are originated. You’re then hit with penalties and fees if you can’t repay it. You’re better off accruing some credit card debt than using these loans.

More from TLC Loans

TLC Loans is a consumer installment lender offering a personal loan online in the states of Illinois, Missouri, South Carolina, Utah, and Wisconsin.

Our mission as a loan company is to help people when traditional banks have abandoned them and to design our loans to get people back on their feet. We consider all applications, so never hesitate to apply! The process is quick and easy and it’s possible to have the funds as soon as the next business day.

Stay physically and financially safe during this global crisis! Contact us for any additional information you need:

📧 customercare@tlcloans.com