Here’s how to keep your credit rating in good health, even in scary financial times.
6 Ways to Protect Your Credit During the COVID-19 Pandemic
Whether you’ve had excellent credit for a while or were in the process of bumping your score from poor to good when the coronavirus pandemic wreaked havoc on the economy, you probably know how important that score is when you need to apply for a loan or credit card.
Click or swipe to find out steps you can take to keep your credit score intact during the pandemic.
1. Pay bills on time if you can
However, do your best to pay at least the minimum payment so that you don’t fall behind and damage your payment history and credit score.
2. Communicate with creditors
Since payment history accounts for around 35% of your credit score, it’s important to contact your creditors if you think that you won’t be able to make payments on time.
Most credit card issuers have COVID-19 updates on their website, instructing cardholders to contact them for deferral of monthly payments. If you can’t make your auto or other loan payments, contact the bank directly to ask about deferral or other options.
“As with other natural disasters and emergencies, they may be willing to provide forbearance, loan extensions, a reduction in interest rates, and/or other flexibilities for repayment,” says the Consumer Financial Protection Bureau (CFPB).
3. Review your credit report regularly
If you obtained a forbearance or other payment assistance from mortgage lenders, student loan providers or credit card companies, make sure those deferred payments weren’t mistakenly reported as past due by the creditor.
You can obtain a free copy of your credit report from each of the major credit bureaus – TransUnion, Equifax and Experian – once every year. If you haven’t received copies of your free annual credit report, you can get a free copy at AnnualCredit Report.com.
4. Know your rights under the CARES Act
The Coronavirus Aid, Relief and Economic Security (CARES) Act places special reporting requirements on companies that report your payment information to major credit bureaus during the public health emergency.
The requirements apply to those affected by the coronavirus pandemic who arranged a forbearance or other modified payment plan with a lender or creditor. For example, If you were current on payments when you made the agreement, then the creditor must report to credit bureaus that you are current on your loan or account – as long as you continue to meet the payment agreement.
However, if you were already behind on payments when you and the creditor made the agreement, the lender will report the account as delinquent until you bring the account current.
5. Report and dispute credit report inaccuracies
If your credit report contains inaccuracies, you will need to report or dispute the information to have it changed or removed from the report. To dispute an error you must contact both the credit bureau reporting the inaccurate information and also the company that reported it.
Not sure how to go about disputing a mistake on your credit report? Check out the CFPB guide to disputing a credit report error, which also includes contact information for the three major credit bureaus.
6. Don’t fall victim to COVID-19 phishing emails
If you receive an email that appears to be from the Centers for Disease Control and Prevention (CDC) or another well-known organization with updates or statistics and click on or download the attachment, you might open the door to malicious software that could access your personal or financial information, according to Experian.
Other scam emails take you to a site that asks you to enter personal information. Other scam emails may ask for donations for illegitimate charities.
To protect yourself from phishing attacks, Experian recommends deleting emails that ask for personal information. Also check the sender’s email address to make sure it matches the organization supposedly sending the email and hover over (not clicking on) all links in the email to see where they lead.
This article by Deb Hipp was originally published on Debt.com.
Published by Debt.com, LLC