Not Getting a Paycheck? What You Can Do

Highlights:

• Notify lenders and creditors of your situation
• Pay what you can
• Consider adding a consumer statement to your credit reports

It’s worrisome when a regular paycheck stops arriving, leaving you wondering how you’ll pay your bills – whether it’s because of a job loss, because you’re a federal worker furloughed by a government shutdown or for any other reason. 

It’s even more stress-inducing if you’re one of the millions living paycheck to paycheck, or if you rely on two incomes to make ends meet. Some four in 10 adults don’t have enough to cover an unexpected $400 expense, according to the Federal Reserve’s Economic Well-Being of U.S. Households Report released in May 2018.

When it comes to your credit, here are a few things to consider if you’re suddenly without a paycheck: 

Notify your lenders and creditors of your situation. Lenders and creditors may be willing to work with you, particularly in the case of federal workers affected by the current partial government shutdown, and may offer help.

For instance, several credit unions are offering interest-free loans to members who are federal employees. Some banks are reversing fees including late mortgage payment fees, late credit card fees, monthly service and overdraft fees. Banks and credit unions may also be able to help with loan modifications and repayment plans. You may need to provide evidence of your furlough.

Speak with landlords or creditors first. If you are a furloughed employee, it is important to contact your creditors and landlords first to let them know you are impacted and quickly work out payment details. Be sure to confirm this information in writing, and keep a copy for your records.

Pay what you can. To try to avoid late payments, which could appear on your credit reports and in turn impact credit scores, try to make at least the minimum payment on accounts, or any amount you and the lender or creditor agree on. 

Keep an eye on your credit reports. Continue to monitor your credit reports regularly to ensure what’s being reported by lenders and creditors is accurate and complete. You’re entitled to a free copy of your credit reports every 12 months from each of the three nationwide credit bureaus by visiting www.annualcreditreport.com. You can also create a myEquifax account to get six free Equifax credit reports each year. In addition, you can click “Get my free credit score” on your myEquifax dashboard to enroll in Equifax Core Credit™ for a free monthly Equifax credit report and a free monthly VantageScore® 3.0 credit score, based on Equifax data. A VantageScore is one of many types of credit scores.

Consider adding a consumer statement to your credit reports. You can add a brief 100-word statement to your credit reports to explain your situation. See how to add a statement to your Equifax credit report.  You can also contact Experian and TransUnion to add a statement on those reports.