The coronavirus pandemic has caused widespread financial distress in the United States and across the world. Many Americans became unemployed due to the business shutdowns associated with the pandemic and small businesses faced dwindling operations and significant profit loss. Many individuals and businesses have felt that bankruptcy might be the only option available to them under the circumstances; however, there are workout options available that may provide relief in lieu of a bankruptcy filing.
First, you should contact all creditors you are in arrears with. You can check if they are offering any special Covid-19 relief programs. Many credit card companies, bank, auto lenders and mortgage companies are offering specific relief to customers in response to the pandemic. Some utility providers are waiving late fees and providing other relief such as delayed cut off of services. You need to be proactive in pursuing any form of relief you can during this unprecedented time. Even if your creditors are not offering any special programs, you should request debt modifications that are feasible for your circumstances.
Some of the relief being offered by creditors includes options such as deferred payments (with or without interest). Other options include moving missed payments to the end of a note, waiver of late fees and other penalties, restructured payments or lump-sum discounted settlements. For some, bankruptcy may be inevitable especially if your employment or business will be permanently shut down due to Covid-19; however, it is worthwhile to pursue non-bankruptcy workout options to develop a plan to effectively deal with debt.
About DelCotto Law Group
DelCotto Law Group is Kentucky’s asset protection law firm known for its commitment to the lifetime success of its clients. With offices located in Lexington, Louisville and Danville, DLG serves Kentuckians with complicated financial matters, especially in the areas of bankruptcy and complex litigation. For more information please call (859) 231-5800, email [email protected] or reach us on our contact page.