The coronavirus pandemic has left many Americans, including business owners, families, students and self-employed workers, reeling financially. If you're looking for financial relief and recovery aid during and after COVID-19, these resources can help.
1. Federal student loan relief
The Coronavirus Aid, Relief and Economic Security Act includes a key provision for federal student loan borrowers. Through September 30, 2020, automatic forbearance applies for eligible borrowers and interest rates on loans drop to 0 percent. You still have the option to make payments during this time. But if you choose not to, it won't hurt your credit score.
2. SBA loan debt relief
If you have an existing SBA loan for your small business, you can get temporary relief from making payments. The SBA will pay six months of principal, interest and fees for current borrowers who owe 7(a), 504 and microloans. Relief is automatic and there's nothing you need to do to apply.
3. Mortgage forbearance
Homeowners can request a forbearance period from making mortgage payments for up to 180 days. Once approved, a second 180-day extension period can also be requested. This relief is available to homeowners with federally backed mortgages, including FHA loans, VA loans, USDA loans and mortgages owned by Fannie Mae and Freddie Mac. If your home is in foreclosure because of missed payments, the Act also temporarily halts those proceedings.
4. Economic impact payments
The CARES Act approves cash payments to help Americans who may be experiencing a loss in income due to the COVID-19 pandemic. Eligible taxpayers can receive up to $1,200, plus $500 per eligible child. The typical family of four would receive $3,400 under the program.
5. Pandemic Emergency Unemployment
If you've been laid off from work as a result of the coronavirus outbreak, applying for unemployment can help. The CARES Act provides for an additional $600 per week in unemployment benefits, on top of what you're already receiving. The program allows for benefits to be extended up to 13 weeks.
6. Pandemic Unemployment Assistance
If you're a freelancer, self-employed or a gig worker, you can also get unemployment benefits under the CARES Act. Pandemic Unemployment Assistance (PUA) allows people who wouldn't ordinarily qualify for state unemployment benefits to apply and be approved for cash payments. If you're approved, it's also possible to receive the $600 weekly payments allowed with Pandemic Emergency Unemployment.
7. Federal Trade Commission
Emergency situations like the COVID-19 outbreak can spawn a number of scams that target people financially. The Federal Trade Commission offers tips and resources for how to recognize and protect yourself against coronavirus-related scams.
8. CARES Act retirement benefits
If you have money saved for retirement in a 401(k) or individual retirement account (IRA), the CARES Act makes it easier to tap into that money if necessary. Under the Act, you can borrow up to $100,000 from your 401(k), double the usual 401(k) loan limit of $50,000. Payments on 401(k) loans can be deferred for up to one year. You can also withdraw up to $100,000 from an IRA penalty-free, regardless of age. You'll have to pay taxes on the money, but you can spread payments out over three years. Required minimum distributions are also temporarily waived for 2020.
9. State and local resources
In addition to federal coronavirus relief, you may also be able to find help at the state and local levels. Some of the initiatives state and local governments may offer include:
Check with your state and local government to see what COVID-19 recovery options are available.
If the coronavirus pandemic is causing you financial stress, it's important to know that help is available. It may also be a good time to consider updating your financial plan, including reviewing your life insurance coverage to ensure that your family is protected.