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What to Do About Credit Card Debt During the Coronavirus Pandemic


The country may be shut down for business right now, but it’s business as usual for many credit card lenders. They want their money back plus interest, and most don’t care that you’ve been laid off or your hours have been reduced and you can’t afford to pay right now.

While some lenders are offering various forms of assistance during the coronavirus pandemic, others are collecting on money judgments by garnishing wages or levying on bank accounts. Some are in ongoing collection lawsuits against their customers or threatening to sue their customers.

If your credit card lender is not offering assistance and you can’t afford to pay, we are here to help, whether through debt settlement, Chapter 7 Bankruptcy, or Chapter 13 Bankruptcy. It’s not your fault that the economy is at a standstill and you are struggling to pay your bills. Don’t be a financial victim of COVID-19. Call us at 215-625-9600 to talk about your options. 

Why Should I Worry About Credit Card Debt Now?

Your Credit Card Lender May Cancel Your Card or Reduce Your Credit to Prevent Abuse

During the recent recession, credit card lenders pulled back by lowering credit lines or canceling cards entirely to minimize the risk of default. It is likely the same will happen sooner or later as our economy suffers during the nation-wide lockdown.

You May Need Cash as the Coronavirus Emergency Continues

If the country is basically shut down for the next few months to stop the spread of COVID-19, you may need cash on hand, especially if your credit is reduced or canceled altogether. Money that you would otherwise use to pay your monthly credit card payment will be needed for the bare necessities like food, rent or mortgage, and utilities.

Even if your credit card lender is offering some type of assistance or forbearance, you should have cash on hand to spend on necessities. That way, you don’t need to use your credit card, and your credit card balances don’t continue to grow. 

Some Credit Card Lenders are Offering Relief

Many credit card lenders, including Capital One, Chase, Citi, U.S. Bank, and Wells Fargo, have released statements on their websites announcing that they are offering assistance for their customers during the COVID-19 outbreak. Such help may include:

  • Changing Your Payments Due Date
  • Allowing You to Skip a Payment or Two Payments
  • Lowering Your Interest Rate
  • Forbearing to Collect on Defaulted Debt

Visit your lender’s website or call them to find out what help is available to you.

Managing Other Debt During the Coronavirus Outbreak

If you’ve lost your job due to the pandemic and can’t pay all of your bills, managing your finances will be a balancing act. You must decide which bills to pay. Some of your creditors are offering assistance, and others will demand payment as usual. You must allocate funds thoughtfully to avoid the consequences of default and to ensure that your basic needs are met in this challenging time.

Student Loans

The federal Coronavirus Aid, Relief, and Economic Security Act (CARES Act) passed on March 27, 2020 provides for a six-month interest-free forbearance on all federal student loan payments and stops wage garnishments for student loan default.

The six-month forbearance does not apply to Perkins loans, FFEL loans, or private loans, so if you have those loans, you must continue to pay unless your lender or servicer is offering relief; contact them to find out. Also, keep in mind that the CARES Act does not provide any student loan forgiveness. You’ll have to resume payments after September 30, 2020 unless further legislation is passed.


Federal mortgage lending companies Freddie Mac and Fannie Mae offer payment forbearance for up to 12 months. There are also private lenders granting forbearance for up to 120 days. Contact your lender to find out if you can defer payments.

If you are already in foreclosure, contact a mortgage foreclosure attorney in Philadelphia. While tax sales and sheriff sales are temporarily postponed in many communities, inevitably they will happen. Let us help you keep your home.

Auto Loans – Can You Defer a Payment?

Perhaps. If you’ve lost your job or your work hours have been reduced due to the pandemic, call your lender to explain and ask for help with your car payments. For example, Ally Bank is deferring monthly auto loan payments for up to 120 days. Hyundai Finance is deferring payments for up to three months. Call your lender to explore your options.

Memberships and Subscriptions

Perhaps this occurred to you already, but if you have a gym membership, or a subscription to a concert series, or season tickets to sports events or an amusement park, you can cancel these because you won’t be going anytime soon. 

Contact Your Credit Card Lender for Help

If your lender is not listed about and there is no information about any form of assistance on their website, call them to ask for help. Your lender will likely want to work with you to keep you as a paying customer in whatever way is possible for you. It is much less expensive for your lender to allow you to skip a payment or two than to sue you.

Right now there is no credit card debt forgiveness being offered by lenders or being mandated by the government. This may change as the pandemic continues to affect the economy.

What to Do if Your Credit Card Company Sues You

Do NOT ignore it! If you fail to respond to a credit card debt lawsuit, you let your lender win by default! If you get notice in the mail or are served personally with lawsuit papers, look at them carefully. The court gives you a period of time in which you can respond and defend, and there will be instructions on how to do so.

If you’ve already ignored a lawsuit, it hasn’t gone away – your credit card lender will get a judgment against you and take efforts to collect. Call us or email us sooner rather than later to prevent a judgment against you, wage garnishment, levy on bank accounts, or a lien on your property. We can help you get a fresh start, even during the pandemic.

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