COVID-19 Credit Options and Payment Relief
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COVID-19: Loan Options and Payment Relief
In the midst of this COVID-19 crisis continues to rage, lenders are updating their hardship plans.
Updated on December 7 December 7, 2020
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The COVID-19 crises is affecting nearly everyone when it comes to finances. While a new relief package from Congress might help fill the gap in finances caused by unemployment and other hardships, some may still turn to loans. If you’re already carrying a personal loan, you may require assistance in making your payments.
Although a lot of personal loan companies have tightened approval criteria, other lenders have launched low-rate, small-dollar loans to consumers dealing with financial difficulties. The lenders that had used to have catchall plans for hardship in place for customers affected by COVID-19 have changed to a case-by-case basis.
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If you require to borrow money
It may be worth calling local charities, non-profits, or credit unions to gain the possibility of accessing low-cost emergency cash. There are also lenders that may help when you require the cash for a short period of time.
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Capital Good Fund
is offering a Crisis Relief Loan to people who reside in the six states where they operate: Delaware, Florida, Illinois, Massachusetts, Rhode Island and Texas. The low-dollar loans have the lowest annual percentage rate and deferred payments for the first 3 months.
The loan amount is $300 up to $1,500.
APR: 5% for all approved borrowers.
Duration: 15 months beginning with payments after the first three months. Payouts are deferred for a further time if the COVID-19 crisis continues beyond that. The interest will accrue over the 90-day deferment period, says Chief Executive Officer Andy Posner.
The lender puts a premium on the bank’s history when it comes to underwriting. Instead of looking at the borrower’s income and expenses, Posner says Capital Good Fund will look to determine if an applicant can afford the loan on current income, and If not, the lender will consider whether the borrower could have afforded the loan before the crisis.
The loans do not charge application, closing or prepayment fees and don’t require collateral. The loan will be approved two days after having submitted an application. Posner says applications for the Crisis Relief Loan will be given priority ahead of other applicants.
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Salary Finance
Salary Finance provides loans through employers, and also works with Equifax to provide companies with an insight into their employees’ financial health. The partnership was in the works before the COVID-19 crisis started, according to Salary Finance CEO Dan Macklin, and its offering isn’t tied to the virus’s influence on the economy.
Employers who sign up to the alliance receive access to an anonymous view of their employees’ credit information, Macklin says. Businesses can utilize the information for free to spot those groups that are facing the most financial stress and then address the issue.
Salary Finance is typically provided through human resource departments as a benefit for employees, Macklin says. Payments made on Salary Finance loans are reported to the 3 credit bureaus.
The loan amount is $1,000 up to $5,000, or up to 20% of an employee’s salary.
APR: 5.9% to 19.9 percent.
The term is 6-36 months.
Other borrowing options
: These not-for-profit institutions offer some of the most consumer-friendly loans. The credit union loan usually comes with lower interest rates as well as more flexible conditions than those from an online lender or a bank.
Fair- and bad-credit borrowers (629 and lower FICO) may have a better chance of getting approval from a credit union due to the underwriting processes tend to include more than just the information about credit.
Some credit unions also offer loans that are more secure than high-interest, shorter-term payday loans. These loans have a maximum APR of 28 percent.
Online lenders: Online lenders could be an easy option . You’ll likely require an excellent credit score and an income that is steady to be eligible in the current economic climate. If you’re uncertain whether you would qualify or what rate you’ll be getting, you can with NerdWallet. Pre-qualifying does not impact your credit score.
If you’re worried about the difficulty of making payments
Certain lenders are offering assistance with deferred payments, as well as waiver of late fees for those who are facing financial hardship. If you require assistance but don’t see your lender listed here, check other options .
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Best Egg
Encourages borrowers to log into the account and see what options may be available.
Customers can opt for payment deferrals or adjustments to payments, or a debt-management program which could reduce monthly payments on all debts, as per an official spokesperson from the company.
Discover
There was a time when a one-month deferral was offered. A spokesperson for the company confirmed that the program was ended and the company is encouraging customers to contact them for assistance with their loan instead.
Customers needing help for longer than a month can call 866-248-1255 or utilize the mobile app of the company to connect with a Discover representative.
HSBC
If you’re struggling to pay an , you can request a hardship program by dialing 800-524-9686. The company offers different hardship programs for its products and doesn’t specify what modifications are available to personal loan customers. A spokesperson did not respond to multiple requests for clarification.
LendingClub
The bank is allowing borrowers affected by COVID-19 to defer payments and only pay interest for deferrals according to a spokesperson.
The lender updates its website its website, and has a phone number that can be used for inquiries regarding hardship at 877-644-4446. The company says it takes up to 10 days for it to handle hardship inquiries.
The company launched its new service in May. LendingClub introduced a service for existing personal loan customers, dubbed Member Center, according to an announcement. Alongside payment options that allow borrowers to restore their regular payments, the Member Center has a tool called Credit Profile that helps customers manage their finances and improve their credit. The tool gives customers a complete overview of their financial situation and includes information such as their debt-to-income ratio, credit utilization and credit score.
A spokesperson for the company has stated that the tool will remain available to users after the COVID-19 saga has ended.
LightStream
may allow customers affected by the pandemic or another natural disaster to postpone loan payments. Contact us to receive a telephone number that will connect you with someone who will be able to discuss your situation. It is not possible to defer a payment if you’re within two days of a scheduled automatic payment.
The credit bureaus report deferred payments as deferments affected by a natural disaster and will not adversely affect your credit score, according to the company. The payments are added to the end of your loan and the they will incur interest when payments are deferred.
Borrowers can log in and go to the Account Services page to request an extension, or send an email for assistance.
OneMain
They will assist borrowers who are struggling to make their payments. The borrower assistance program of the lender, which was part of the loan prior to the outbreak, can help borrowers receive lower or deferred monthly payments, according to a spokesperson.
Oportun
can offer customers reduced and deferred payments. The company claims it will not report missed payments as late to credit bureaus if you have made arrangements prior to. Customers can contact the company via email at or at 650-419-5779.
OppLoans
The company is offering 30 days of missed payments “no questions asked” for those affected by COVID-19, according to its CEO Jared Kaplan. After that, customers are able to apply for a 90-day hardship program, which will cut payments in half. The company says that these arrangements won’t negatively affect credit scores.
PenFed
is offering to allow eligible borrowers to make a payment on their own. Find out if you’re eligible, and choose “Financial Assistance for COVID-19-affected members.”
PenFed also offers a service where customers can apply for a short-term emergency program (less than 6 months) or a long-term financial hardship plan (more than 6 months).
PNC
It says it could offer postponed or reduced payment options to loan customers who are now experiencing a hardship or whose hardship plans are close to expiring. For most customers, the company states it can confirm the eligibility to receive assistance right away. To apply, visit PNC’s and click “Apply to the Consumer Loan Help with Hardship.”
Customers need to sign up for online banking to access the .
Possible Finance
offers a plan for forgiveness which allows customers to push payments out. The lender hasn’t provided any details about the plan since it posted the blog post in March, however customers are able to contact the customer service department via .
Upstart
offers loan modification options available to some customers who are affected by COVID-19, such as the option of an extended loan term or forbearance, according to one Upstart spokesperson. Previously, customers could defer up to two months worth of payments with no penalty or interest.
Contact Upstart by email
Wells Fargo
The deferred monthly payment will be available for three consecutive billing cycles for qualified customers with personal loan customers. Those who already have assistance may still apply for additional assistance. Log into your online account to see the options available.
To connect with a Wells Fargo customer service representative to speak with a representative, dial 877-269-6056.
About the writer: Annie Millerbernd is a personal loans writer. Her writing has been featured in The Associated Press and USA Today.
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