Financial Help for Those Impacted by COVID-19

    The American economy is sputtering back to life after being shut down to prevent the spread of COVID-19, but the re-start may be slow in growing.

    Over 30 million Americans have had to register for unemployment in the last six weeks, despite the stimulus relief from the $2.2 trillion CARES Act.

    The last of the 150 million stimulus checks for $1,200 stimulus will go out early in May through the regular mail, mostly to consumers who regularly receive government checks for Social Security, Supplemental Social Security, Railroad Retirement Benefits, VA benefits and disability benefits.

    The Paycheck Protection Program (PPP), which was supposed to help small business owners pay their employees while waiting for their doors to re-open, already went through its original allotment of $350 billion. Much of that money landed in the hands of big businesses posing as small businesses to get the government handout.

    Congress quickly approved another $320 billion and claimed it would spend more time qualifying recipients this time to avoid the embarrassment of national chain companies getting relief money they didn’t need.

    Still, millions of Americans are in desperate need of debt relief programs. Congress is discussing a second round of stimulus checks for consumers, but when it would be sent and how much each consumer would receive, is under debate.

    The original stimulus bill answered some of that need when it was signed into law by President Trump on March 27th. It attempted to provide financial relief to all levels of the U.S. economy from individual consumers to small businesses to large corporations.

    Some of the financial assistance programs passed include:

    In addition to the record-setting stimulus package, private businesses are offering debt-relief programs to ease the economic pain.

    Jump to: Private Companies Offering Covid-19 Assistance

    Many of the major banks and credit card companies are offering small, but welcome debt-relief choices for consumers hit hardest by COVID-19. Thasunda Brown Duckett, the CEO of Chase Consumer Banking, summed up the situation best for all levels of the economic spectrum when she wrote on the company’s website:

    “Like you, I’m finding it hard to take in all the news about COVID-19. I know many of you are looking for help to manage through this. That’s why we’re doing all we can to make sure our branches are open, our bankers and advisors are there and our call centers are staffed. If you’re affected by COVID-19 and need help with your accounts or making payments, please reach out to us.”

    The CARES Act: Stimulus Package for COVID-19 Relief

    The federal government tried to answer the “Help Wanted!” cries of consumers, but as often happens when politicians go to work on something, there was much wrangling to go through to get something done. In the meantime, some departments in the Trump administration took their own action.

    Here is a rundown of the most impactful debt-relief options in the stimulus bill.

    $1,200 Coronavirus, COVID-19 Relief Checks

    Every individual making $75,000 or less will receive a stimulus check from the U.S. Treasury for $1,200. A couple that makes under $150,000 and files taxes jointly would each receive $1,200 for a total of $2,400. Married couples will get an additional $500 per child. Reduced checks will go to people making between $75,000 and $99,000 a year ($198,000 jointly).

    Eligibility is determined by your 2019 or 2018 tax return. The government will check your tax return for those years and, if you qualify, you should receive the money by direct deposit or check. If you have registered your bank account when paying taxes to the IRS, you should either have received your stimulus check. Those who receive IRS refunds via regular mail, may not get their checks until sometime in May.

    The IRS had trouble verifying the bank account numbers for millions of taxpayers who used services like Jackson Hewitt, H&R Block and TurboTax to prepare their taxes. Thus, they couldn’t direct deposit the $1,200 checks until they were certain they had accurate account numbers.

    You can track your payment through the Get My Payment tool on the IRS website.

    A word of warning to the millions of consumers being chased by debt collectors – the collection agency may get to your stimulus check before you do!

    Collection agencies took note of that and aggressively went after bank accounts of those who hadn’t paid off their debts. Debt collectors with court judgments that allowed them to garnish bank accounts of consumers with past-due accounts, did so as soon as the stimulus money hit the account.

    A second stimulus check – sometime in the summer – has been discussed, and we will provide any updates as the news develops.

    Unemployment Benefits

    The average payout for unemployment is $300 a week and last 26 weeks. That timetable has been expanded to 39 weeks and freelancers and gig workers would qualify for the first time.

    From a coronavirus standpoint, people unable to work because they are sick, quarantined or need to care for children because of COVID-19, will receive an “added benefits” check for $600 per week. The “added benefits” would last four months.

    401(k) Penalties Waived

    The federal government will waive the 10% early-withdrawal penalty for taking money from your 401(k) retirement fund. Qualified individuals can withdraw as much as $100,000 to help them get through this crisis.

    Paycheck Protection Program for Small Businesses

    The Paycheck Protection Program got a $310 billion boost from Congress to provide small business loans that could be forgiven if the company follows certain conditions like not firing its workers; using the money to cover employee salaries; pay health insurance premiums; utilities and rent.

    The program came under immediate fire when it was revealed that national franchise food restaurants like Shake Shack and Ruth’s Chris Steak received more than the $10 million dollar limit that despite not being “small businesses.”

    The program was designed to help companies with less than 500 people stay open and pay employees for eight weeks. It ran out of its $350 billion in funding April 16, less than two weeks after it launched. During that time, it guaranteed 1.6 million loans to small businesses.

    Congress added another $310 billion in funding for the program and though only $93 billion was committed to businesses the first week, that was considered a plus for small business owners. The Treasury Department has declared it will spend more time reviewing applications for this round of loans and eliminate some of the businesses that don’t fit in the “small” category.

    Big Business Gets Some Breaks

    Companies with more than 500 employees and deemed “severely distressed” will receive large grants or loans.

    The passenger airline industry, for example, will get $25 billion in grants (money they won’t pay back) and another $25 billion in loans they are expected to pay back.

    There is $17 billion in loans to companies considered critical to national security and $425 billion for other businesses, states and cities.

    Hospitals and Health Care Centers Get Help

    The stimulus bill set aside $100 billion to help hospitals that were hit hardest by the pandemic. The money is intended to allow them to purchase protective gear for health-care workers, testing supplies and support emergency operation centers.

    Community health centers and public health agencies like the Center for Disease Control and Prevention also will receive funding to help them get better prepared for the next crisis.

    Other Beneficiaries

    Some of the agencies expected to play a big part in the recovery from coronavirus received much-needed help from the stimulus package.

    The food stamp program, now called SNAP, will get $25 billion to help the hungry; local schools and colleges will receive $31 billion; the Federal Emergency Management Agency will get $45 billion; and local transit systems will receive $25 billion.

    Help from Government Agencies

    Several agencies in the Trump Administration didn’t wait on Congress to pass a stimulus bill. They took action on their own. Here are some of moves you might find useful.

    Paid Sick Leave

    Congress actually passed a bill called the Families First Coronavirus Response Act to help workers in smaller businesses deal with using sick leave to care for their families.

    The target audience for the new law is companies with less than 500 employees. Those companies will receive a tax credit on next year’s tax bill for offset the cost of providing it to their employees.

    The intention of the new law is to give two weeks of paid sick leave at 100% of your normal salary – up to $511 per day – for a total of $5,110. That is just the first of many qualifiers for this program so check with your company’s Human Resources Department before making plans.

    Benefits of Paid Sick Leave
    • You can get two weeks of paid family and medical leave at two-thirds your regular pay rate to care for an individual subject to quarantine.
    • You could get an additional 10 weeks paid family and medical leave at two-thirds pay, up to $200 a day (and $10,000 aggregate), if you’re a parent caring for children whose school has closed.
    • Employees must have worked at least 30 days to be eligible.
    • Businesses with less than 50 employees may be exempt from providing leave due to school closing or childcare unavailability if that jeopardizes the viability of the business.
    • Businesses with more than 500 employees are exempt from the law.
    • Nursing homes, hospitals and health care providers also are exempt.

    Tax Break … Sort of

    The Treasury Department announced that if you still owe income taxes for 2019, you get an extra three months to file. The filing date was moved from April 15 to July 15, allowing people more time to focus on dealing with the financial fallout of COVID-19 rather than paying the government taxes.

    If you expect a refund, you can file anytime.

    Student Loan Interest Suspended

    President Trump announced on March 21 that federal student loan borrowers would be given the option to suspend payments through September 30, 2020 without penalty.

    This came a week after the Department of Education said borrowers would pay no interest on federal student loans through September 30, 2020.

    To suspend payments, borrowers should contact their service providers and enroll in the forbearance program.

    Federal Reserve Cuts Interest Rate to 0%

    The Federal Reserve did its part to slow the economic downturn by reducing interest rates to 0%, but the move hasn’t helped its intended targets: a stable stock market and lower borrowing rates for consumers and small businesses.

    The Dow Jones Industrial Average, which peaked at 29,568 on Feb. 12, 2020, went as low as 18,213 on March 23, a drop in value of 38%.

    Small Business Administration Provides Access to Loans

    The coronavirus could be lethal for small businesses, considered the economic lifeline in most communities, but the Small Business Administration is trying to prevent that.

    The SBA is offering low-interest working capital loans of up to $2 million for small business and nonprofit agencies affected by COVID-19. Small businesses would pay 3.75% interest on the loans and nonprofits would pay 2.75% for terms of up to 30 years.

    Many states and cities are offering low-interest loans for small businesses. More information is available on the SBA website.

    Private Businesses Offering Relief from COVID-19

    Private businesses, specifically banks and credit card companies, jumped in first in offering debt-relief options for consumers reeling from the economic fallout of the coronavirus.

    The most often-repeated message from the big banks and credit card companies is for those negatively impacted by COVID-19 to stay home and use online or mobile app banking services to do their bill-paying and keep track of their accounts.

    The second most-common message was: Call our customer service department for specific help with either personal or small business accounts. The sooner you contact a bank representative, the better.

    Each company shared steps to improve the cleanliness in the working area within the banks, including daily cleaning with stronger disinfectant product on high-touch surfaces and offering hand sanitizer at every branch. The push for cleaner surfaces extends to ATMs and the keyboard at ATM locations.

    With that in mind, here are some of the relief services you might take advantage of at specific banks and card companies.

    Chase Bank COVID-19 Recommendations

    Chase strongly suggests customers go online or use mobile apps for:

    • Access to accounts
    • Make bill payments
    • Deposit checks
    • Transfer funds between accounts

    Chase warned customers to be wary of scammers trying to take advantage of the situation and said it would never ask for personal information from a customer like name, address, pin number or password.

    It also said it would help customers understand their options with travel changes and cancellations and work with small businesses to manage potential disruptions during the spread of the virus.

    Chase also offers a chance to talk with J. P. Morgan financial advisors about market volatility.

    Capital One COVID-19 Recommendations

    Capital One is offering many of the same suggestions, but added a “Frequently Asked Questions” page that deals with concerns that come up early in the virus crisis, most of them dealing with cancelled travel plans.

    If you want to contact Capital One about its personal credit card products, there is a page with phone numbers and mailing contact for virtually every problem.

    There also is a page with numbers to ask about small business credit card issues.

    Citi Bank COVID-19 Relief

    CitiBank extended a program through May 8 for its retail customers to waive monthly service fees and penalties for early CD withdrawals. Citi’s small business customers also get monthly service fees and remote deposit capture fees waived as well as waived penalties for early CD withdrawal.

    Citi said cardholders can avoid long wait times on calls by submitting requests for assistance by logging into their accounts online. The company also said it will monitor the economic recovery and may extend its crisis assistance if the situation calls for it.

    Eligible customer can use Citi’s “always on” assistance programs for credit line increases and forbearance options.

    Citi directs customers to take advantage of its online and mobile apps to access accounts and do regular banking business.  The company says it has made a number of enhancements to those services that make it easier to manage your account digitally.

    U.S. Bank COVID-19 Relief

    U.S. Bank is offering mortgage assistance programs that may allow customers to suspend payments for up to 180 days with no late fees.

    It is offering two loans for personal accounts that may provide short-term solutions. It also is offering:

    • Simple Loan: Customers can borrow from $100 to $1,000 at $6 interest per $100 borrowed. Loan is repaid in three equal monthly payments.
    • Personal Loan: You can borrow $1,000 to $4,999 for up to 48 months at 2.99% APR.

    U.S. Bank also is offering two loans for customers with small business accounts.

    • Quick Loan for general business purposes: You can borrow $5,000 to $250,000 with terms from 12 to 84 months at an interest rate 2% lower than the standard rate for which the business would qualify.
    • Cash Flow Manager (secured and unsecured): An on-demand line of credit of $10,000 to $250,000 at an interest rate 1% lower than the standard rate for which the business would qualify.
    • 0% Interest on Platinum Card: Get 0% interest on purchases and balance transfers for 20 billing cycles with the Platinum Card.

    Wells Fargo COVID-19 Relief

    Wells Fargo posted a news release March 8th about donating up to $6.25 million to aid in a coronavirus response.

    The bank said it would suspend residential property foreclosure sales, evictions and involuntary automobile repossessions. It will offer fee waivers, payment deferrals and other expanded assistance for credit card, auto, mortgage, small business and personal lending to customers on a case-by-case basis. Customers must contact the bank.

    Scammers Alert

    The Federal Trade Commission has posted a warning that scammers are looking at panic-stricken consumers as easy prey for opportunities to take money or steal personal information.

    Scammers could be using fake social media posts, texts or email posts that sound like news on treatments or information on where to make donations for relief funds and it’s all fake.

    Here are the FTC’s warnings about scammers:
    • Don’t click on links from sources you don’t recognize
    • Ignore emails claiming to come from the Center for Disease Control
    • Avoid online offers for vaccinations or treatments
    • If someone is asking for donations in cash, gift cards or wiring money, stay away!
    • Beware of “investment opportunities” in any company claiming that says it can detect, prevent or cure coronavirus.
    Bill Fay

    Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it seven years ago, helping birth Debt.org into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering college and professional sports, which are the fantasy worlds of finance. His work has been published by the Associated Press, New York Times, Washington Post, Chicago Tribune, Sports Illustrated and Sporting News, among others. His interest in sports has waned some, but his interest in never reaching for his wallet is as passionate as ever. Bill can be reached at bfay@debt.org.

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