First the sequester, now the shutdown. Federal employees in Maryland are beginning to feel as if they will never get a break from financial limbo. It is hard, a friend of ours said, to go over your grocery bills and count pennies even though you have a good job that pays well and that you love.
Furloughed workers who find themselves running short of funds may find themselves looking for creative ways to make ends meet. Some may be tempted to put everything on a credit card and hope that the shutdown ends and Congress approves back pay. Others may be working with creditors to figure out ways to reduce minimum payments without damaging their credit.
Some may even be eying short-term payday loans. The shutdown cannot last much longer, they may be thinking, and the payday option is better than borrowing from relatives. Plus, the credit cards are still maxed out from the last furlough.
There are always options, and some come from a surprising quarter: banks.
Banks are now offering programs specifically designed to help their customers who are furloughed government workers. One bank, for example, offers an interest-free $1,000 cash advance to qualifying customers. The same bank is reimbursing credit card late fees and working with borrowers to reduce mortgage payments through early November.
Another bank is offering a one-month payment deferral on consumer loans to borrowers affected by the shutdown. For its mortgage customers, the bank is offering a one-month forbearance. The bank has also set up a toll-free assistance line for customers who are worried about hitting a financial wall before the shutdown is over.
For workers who were living closer to the edge at the time of the shutdown, there is also the option of personal bankruptcy. If nothing else, meeting with a bankruptcy professional to discuss debt relief options might provide some peace of mind if the shutdown goes on much longer.
Source: Philadelphia Business Journal, “Banks helping furloughed workers,” Jeff Blumenthal, Oct. 9, 2013