If you’ve lost your job due to coronavirus-related reasons, you stand in good company (26 million in the past five weeks). So many people are in the same boat, in fact, that federal and state governments have expanded their unemployment benefits as part of their coronavirus relief. What’s more, there is assistance available regarding rent, mortgages and student loans, thanks to the federal stimulus package. To help you weather these difficult times, SmartAsset has put together this coronavirus relief guide for those who have been laid off. For hands-on help, you may want to consult a financial advisor.
You’ll first want to determine if you’re eligible for unemployment insurance. Any worker can qualify for unemployment compensation if they’re temporarily unemployed through “no fault of their own,” so you’ll likely be eligible to receive financial assistance as you search for other jobs. Many forms of unemployment compensation existed before the COVID-19 pandemic, but the government has expanded its enhanced unemployment benefits to help aid those directly affected by the virus. The $2 trillion stimulus package known as the CARES Act offers a weekly payment of $600 that is in addition to any other unemployment compensation an individual qualifies for. The weekly payment lasts until July 31, 2020, and the act provides pandemic unemployment assistance for up to 39 weeks (an increase of 13 weeks from the 26 weeks normally available). The act, which now covers independent contractors, gig workers, freelancers and furloughed workers, also applies to those who meet any of the following conditions:
- They are diagnosed with COVID-19 or are experiencing COVID-19 symptoms and seeking medical diagnosis
- A member of their household was diagnosed with COVID-19
- They’re providing care for a family or household member who has COVID-19
- They’re the primary caregiver for a child unable to attend school or another facility closed due to COVID-19
- They cannot reach their place of employment because it is either closed or they are quarantined due to a COVID-19 outbreak
- They were scheduled to commence employment and cannot reach their workplace due to the COVID-19 outbreak
- They have become the breadwinner of the household because the head had COVID-19 and has died
- They had to quit their job because of COVID-19
Unemployment benefits will be of particular interest to those who work in places most likely to be affected by the COVID-19 recession.
Mortgage and Rent Relief
We’ve established that if you’re currently unemployed through “no fault of your own,” you may eligible for various unemployment benefits. But the federal government also provides coronavirus relief to homeowners and renters. Specifically, under the CARES Act, homeowners with a federally-covered mortgage can request up to 180 days of forbearance if they have been financially impacted by COVID-19. During the forbearance period, loan services or lenders cannot charge any extra fees or penalties. If more time is needed, the law allows homeowners to request an additional 180 days.
Additionally, as of March 18, lenders covered by Fannie Mae and Freddie Mac cannot enforce foreclosures or evictions for a 60-day period.
Even if your mortgage is not federally backed, you should still contact your lender or service provider. Many private banks are offering temporary mortgage relief.
If you rent, assistance is much more limited. If your landlord has a federally backed mortgage on the property you live in and is receiving mortgage relief, they cannot evict you for 120 days.
Student Loan Relief Options
If you’ve got student loan debt, you have a range of coronavirus student loan relief programs at your disposal. First and foremost, under the new stimulus package, all federal student loan payments are suspended until September 30, 2020. During this period, interest won’t accrue on your loans. This provision strictly applies to federal student loans, and it is optional. Private student loans and Family Federal Educational Loans (F.F.E.L) don’t qualify.
Again, if your lender is private, you should still contact them to see if they are offering any special help for borrowers who have lost their jobs due to the pandemic.
Cut Costs and Adjust your Budget
Think about where you can make changes in your spending habits. Since your income may be limited, it’ll help to assess your discretionary, variable and fixed expenses. Discretionary expenses represent the things you want but don’t necessarily need. Fixed expenses are regular payments (e.g. rent, loan payments, etc.) that typically don’t vary in amount. Variable expenses can function both as discretionary costs and necessities. If you already have a budget, think of how you can cut costs to strengthen your financial cushion during unemployment. But if you don’t currently have a budget established, SmartAsset’s free budget calculator can help.
Stay Updated on the News
The COVID-19 pandemic is constantly changing, and beyond the devastating public health toll, the coronavirus has battered the economy and left many without jobs. Regardless of your employment status, it’s wise to closely monitor the news so that you can effectively prepare yourself for the forthcoming recession. If you just joined the unemployed ranks, the CARES Act provides several forms of relief that can help you get through this period. Also, remember to pay attention to local, state and national news so that you can take full advantage of government aid if you or someone close to you is affected by COVID-19.
Tips for Finding Unemployment Compensation Programs
- The CARES Act provides Pandemic Unemployment Assistance and federal financial relief to any Americans temporarily unemployed due to the coronavirus, but you may also qualify for state-based unemployment benefits. If you’re wondering what forms of unemployment insurance and unemployment compensation your state provides, try researching your state’s department of labor website to learn more.
- In addition to coronavirus-related unemployment aid, Americans also stand to benefit from various coronavirus relief for rent and mortgage payments. If you’re a current homeowner or tenant, you may qualify for financial relief and eviction protection.
- If you’d like to consult a financial advisor during this period of uncertainty, SmartAsset’s free tool connects you with up to three advisors who suit your financial situation.
- Don’t forget to collect your coronavirus stimulus check. Use our coronavirus stimulus check calculator to see how much money you can expect to receive.
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