In this lockdown, many businesses have closed. Due to this many individuals have declared that they are not able to pay credit card debts. Now banks are dealing with two options. To the individuals who need time, banks are providing them moratorium periods. They are writing off the debts of the individuals who’ve defaulted. Banks and companies are doing this because of tax liabilities. As they are not getting their money back, writing off helps in decreasing their tax liabilities. But this doesn’t mean the individuals don’t have to pay. Just like this, the team has crafted a list of multiple Credit Card tips after losing your job:

•Don’t purchase the cards without reading reviews: The worst mistake committed by an individual is purchasing credit card without reading Assent platinum card review. Instead of skipping reviews, he should read it. This way he can understand all the terms and conditions. As these reviews are written by credit card experts, they can help in availing all the promotional offers. If his credit score is affected then he should focus on availing credit cards for bad credit no deposit. With these cards, he can rebuild his credit score quickly. Now, these bad credit credit cards are of two types. These are secured cards and unsecured cards for bad credit. Let’s compare the pros and cons of both.

While purchasing a secured card, the buyer has to deposit the collateral. This collateral is must and is equal to the credit card limit. For example, if the limit is $500 then he has to deposit it. The interest rate here is low. However, in case of the unsecured card for bad credit, there is no need for depositing collateral. That’s why the interest is high. The only thing common between both the cards is that users with bad or no credit can avail them.

•Saving money: The second tip is to save money. Now the individuals who’ve lost their jobs are not going to receive salaries. This means there is zero inflow of money while the outflow will increase. That’s why it is important to reduce expenses. Now, this can be easily done by maintaining a balance sheet about where the money is going. This way individuals can eliminate the unnecessary expenses.

•Financial diet: When the inflow of money is zero, the financial diet is important. Individuals should avoid luxury lifestyles and come back to the normal ones. Remember having food at home is important than riding a Ferrari.

•Prioritize what’s important: Now is the time to prioritise what’s important. As just discussed having food is more important than riding a Ferrari. However, this doesn’t mean the individuals should not spend on job hunting. That’s a type of investment. Stopping job hunting means no chances of getting salaried.

•Use side income sources: If any individual is smart then he must have established a side business. He can also use that extensively. Individuals working in the IT sector can use their skills as freelancers. In freelancing Websites, they can work for companies all over the world. The best part is they are at zero risks of getting infected with covid-19.

•Use severance payments carefully: After layoffs, many individuals receive severance payments according to the length of employment. So individuals who are receiving severance payments in this lockdown are lucky. With these payments, individuals can pay their credit card bills. They can also pause credit card payments by using moratorium periods.

According to experts banks are providing a specific time duration in which credit card users can pause their payments. After the lockdown is over, they can resume their payment from the same state. To help out people banks are companies are using this innovative method. However, if the banks and companies should charge interest is still a debatable factor.

•Pay all the debt: Well this Option is not availed by all the individuals. If an individual can return 70% of his debt then the company can consider him. As per condition the company can eliminate the interest from the deal. Thus, the individual has to pay the original amount.

Note: Any company can reduce the interest rate if the individual is ready to pay the debt quickly. He has to pay debt altogether or in two or three parts. The company will not reduce the original amount as this is a direct loss to the business. The company can compromise with the interest as this is profit, not what the investors invested.

Conclusion: Yes almost all the companies are helping their customers in settling the debt. Now it depends on the consumer about which method he is interested in choosing. If he is expecting a credit card to manage his expenses then he should only go for credit cards for bad credit. However, all the methods discussed above can hurt credit score.