By: Max L. Rosenberg
Bankruptcy Attorney
Rosenberg, Whewell, and Hite, LLC
To many, the extension of the unemployment benefits associated with the CARES Act was a breath of fresh air. Additional funds can go a long way to putting food on the table, keeping the lights on, and putting your mind at ease.
During this devastating time of crisis in our country, we should take stock of our own situations and look f or ways to improve our mental health, physical health, and our financial health. Personally, I took up acrylic painting. My family has filled our walls with YouTube Artist tutorial inspired color and technique. It has been one of the greatest outlets for us to mentally unwind at the end of a stressful day filled with uncertainties. We have kept ourselves safe from COVID by disconnecting from the outside world and staying socially distant from friends and family. It has been challenging, lonely, and it feels like a real sacrifice.
Financial health is trickier. Like many, my family has had to evaluate our choices and shift accordingly. It’s not easy to admit or face that business is hard right now. Not only for us, but for many of you out there who own a business that depends on customers physically being in your store or providing a service for people in person.
Money is tight. Incomes have decreased. Many are facing the difficult task of choosing between spending funds on food, medicine, or electricity. While utility companies, like UI, Eversource, and Southern CT Gas, are not shutting homeowners down yet, that day will come.
Landlords are not evicting but back rent is building. The foreclosure moratoriums are extended, but the balance due is rising. These are cold hard facts of life. They are unpleasant to think about and they are hard to face. The stress of the pandemic, a work or school from home “new normal”, and the myriad of life restrictions is hard enough without facing a crushing ever growing mountain of debt.
Why am I pointing all of this out to you? My dear reader, it’s time to evaluate your situation.
Are you taking this time to pay down your debt by keeping up with interest payments or minimum
payments due? It’s important to see where that money is going and how it is serving you. The answer
to the latter is that it is not serving you at all, but it is paying the credit card companies their salaries.
Did you know that credit card companies make most of their money from interest and fees? That’s
right. Your CARES Act Stimulus payment or Unemployment payment you have been provided from
the federal government to help keep you afloat, that you used to pay the minimum balance or interest
only payment to your credit card minimum balance due of $35 just helped pay for the CEO’s cup of
coffee. Nice!
COVID Cares Act does NOT stop credit card companies and debt collectors from going after you for
debt owed to them. Most companies are now offering deferments or accommodations for paying
back the debt, but you have to be very careful about the fine print. They may still be charging
you interest during that time. While you were very careful to buy the clothes, groceries, or other
necessities on sale, your interest rate on your card you used may erase any savings you may have had.
Is that fair? Maybe, who’s to say what fair really is these days. It’s the truth of the matter, which is
what affects you and your financial health. Carrying credit card debt and other debts is a burden. This
is especially painful if you got into unmanageable debt through no fault of your own. Pandemic
restrictions and other life factors affect us all at inopportune times. As is usually the case in life, we
all have to find our own way out of this mess.
The debt you owe and may be on hold for now, during the national emergency, is not going away.
When the fog of the pandemic is lifted, and we start to open the doors to business as ‘usual’ again,
how will your finances look?
Can you see how you will get out of debt before that happens? If you have over $10,000 in credit
card debt, Medical debt, mortgage arrearage, and other financial obligations, and no foreseeable way
out, it’s time to listen up. There is a way out!
Debt relief is around the corner and waiting for you to knock on the door. Bankruptcy can be your
ticket. I know, I know I said the bad “B” word that makes some people feel like they have failed in
adulting life. Stop that! You have not failed. You have not ruined your future. Bankruptcy has saved
countless futures, helped countless families, and has made it possible for so many to start fresh and
open path to success.
Imagine now, if you are collecting unemployment or receiving other relief from the CARES Act, that
you no longer have to use any portion of that relief to pay your fees and interest only payments on
credit cards or medical bills and not face consequences debt collectors calling you.
Imagine that you can actually stop paying a mortgage that you cannot afford. Imagine your UI bill
that has been on hold for 10 months suddenly reset. Imagine the debt collectors stop calling you and
you don’t have to screen your calls anymore. Imagine waking up and not being on the hook for
crushing medical debt.
No more debt means you can make choices that will help you and your family. Stop struggling to
keep above water and sit on the boat of debt free life. Use the stimulus checks to help your family get
food on the table. Use your boosted unemployment to help you get the tools you need for a new and
better job. You have the power to take control of your financial situation. It’s just a phone call away.
Call an experienced bankruptcy attorney. I will help you find the freedom in your financial situation.
It is never too late to get your fresh start.
Back to my original title question, “How the CARES Act is giving you time to get a fresh start”, it
is giving you a foreclosure moratorium, no evictions, no shut down of utility services, a stimulus
payment, and unemployment boosts. These are all intended to give you timeto act, decide, and
adjust. Call today to take a step that will help your family for years to come. Become debt free and
take control of your financial life again.
