Lynnette shares tips to protect your credit rating during the COVID-19 pandemic.
Maintaining a positive credit rating is super important these days. That’s why I want to bring you guys a little bit of a tip regarding something that could affect your credit in the future as it relates to your payment history during the COVID 19 outbreak.
As part of the CARES Act, legislators worked out a deal to basically change the Fair Credit Reporting Act. The bottom line is that if you work out a deal with any of your creditors say, your credit card company, a private student loan company, an auto lender, a mortgage company, etc.
If that company works a deal of any kind with you and gives you any kind of a payment modification or a payment they called it an “accommodation” then that creditor is not supposed to report you late to the credit bureaus to Equifax, Experian, TransUnion. OK, got it. Sounds good, right? And it is a good thing.
Get this, the Consumer Financial Protection Bureau recently said, ” We’re not going to really slap the hand of creditors who don’t exactly abide by that rule that’s been changed. We’re not going to really enforce things on that front.”
That got the attention of a lot of consumer protection groups, as well as Commercial Law After Brexit. They basically wrote a letter to the CFPB and said, “Hey, what gives? We need to protect consumers and their credit rating during this COVID 19 outbreak and this emergency because we have over 30 million people who’ve already applied for unemployment insurance, and we know there’s been all of this turmoil in the economy.”
This is an issue that I want you to keep an eye on. If you work out a deal with one of your creditors, make sure you get everything in writing, again, so you’ll have some proof of that, right? Then keep hold of your records and maintain all documentation in case anything happens down the road.
You want to be able prove that you had a meeting of the minds and a written agreement with your creditor, and you want to have some documentation if you later need to dispute something with the credit bureaus.