OPTION 1: GET HELP REDUCE YOUR BILLS
There are many ways to reduce your expenses or debt. You may be able to negotiate with your creditors to reduce what you owe. Most businesses have programs to help customers experiencing COVID-related hardships. Tell your creditors and other businesses you owe money to that you're having a hard time because of COVID.
SUGGESTION! Prioritize essential expenses first
Pay for your essential needs before anything else. Essential things include shelter (mortgage or rent), food, and utilities. Before an unpaid bill is reported to credit reporting companies, which could hurt your credit score, it must be at least 30 days past due. A single late fee is preferable to a high-cost loan, which will cost you much more in fees. If you're not sure which option is best, you can always call the Capital Good Fund's financial advice line.
living place
Homeowners : If you're struggling financially, consider getting a COVID forbearance , which allows you to put off your mortgage payment. Without the monthly cost of your mortgage, you will be able to better pay your other expenses. The easiest way to get a COVID deferment is to apply on the website of the company that collects your mortgage. If not, you can call them and ask for a “COVID adjournment.” If you already have a COVID deferment that is or is about to expire, visit your mortgage collector's website to request an extension or call them.
If you are experiencing a difficult situation or are experiencing obstacles, find a housing counselor near you through HUD's search tool or call toll-free (800) 569-4287, which is available in multiple languages. Call 888-995-HOPE (4673) and get free comprehensive foreclosure help, 24 hours a day, seven days a week.
Renters: Getting help paying rent can take a lot of pressure off your overall finances. Information about available rental assistance options and applications is available at IllinoisRentalAssistance.org and Housing Action Illinois . Another site, rentervention.com , focuses on Chicago residents, but can assist any Illinois resident. Check out the Consumer Financial Protection Bureau's search tool to find more county and local rental assistance programs throughout Illinois. If you are threatened with eviction, visit EvictionHelpIllinois.org for free legal help. Chicagoans concerned about eviction can find free legal help, rental assistance programs, and other resources at Chicago.gov/eviction .
Housing Counseling: Housing counselors can give you advice on buying a home, renting, loan default, foreclosure, and credit problems. Many housing counseling organizations offer financial wellness education at no cost to the participant. Local Chicago examples are the Spanish Housing Coalition, the Chicago Urban League, and the Resurrection Project . Visit IllinoisHousingHelp.org and sign up for email alerts to find out when Illinois mortgage assistance programs are open.
car payment
Contact the loan entity. Options could include changing your payment due date, creating a new repayment plan to lower your monthly payment, or deferring (postponing) your payments.
Utilities and Internet
Utilities: Each of the major utilities in Illinois has its own bill assistance program: ComEd , Peoples Gas , North Shore Gas , Nicor and Ameren . Explain that you are experiencing difficulties due to COVID. This will help you access funds and policies created to support you during COVID.
If you have low income, call your utility provider and your state utility assistance program. For help with gas and electric bills, visit the State of Illinois Utility Bill Assistance website or call 877-411-WARM (9276) (Mon–Fri, 8 am–5 pm). For help with water and sewer bills, visit HelpIllinoisFamilies.com to learn more about Illinois' new assistance program.
Internet: Illinois residents Eligible can access low-cost Internet, affordable refurbished computers, and digital education training through the nonprofit PCs for People. PCs for People participates in the Affordable Connectivity Program (ACP), reducing the price of your monthly Internet service to $0 and with significant discounts on PCs. For more information and to purchase, visit www.pcsforpeople.org .
The federal government's Affordable Connectivity Program (ACP) can help low-income households pay their monthly Internet bill. Eligible households can get up to $30 per month off their Internet bill. Visit ACPBenefit.org to find out if you're eligible , submit an application and choose an internet service provider. If you need to speak to someone about your eligibility or application status, please call the ACP Support Center at (877) 384-2575.
student loans
President Biden extended the COVID-related loan payment suspension on certain federal loans through December 31, 2022. We recommend that you start preparing now to resume payments in 2023.
President Biden also announced a student debt cancellation program. Individual borrowers making less than $125,000 a year (or families making less than $250,000 a year) can apply to have a certain amount of student debt forgiven: those who received a Pell Grant to go to college are eligible for the cancellation of $20,000 of debt; those who did not receive a Pell Grant are eligible for the $10,000 cancellation.
Cancellation will not be automatic – you will need to submit an application proving your income. The US Department of Education will publish the application in early October and the cancellation process will take approximately 4-6 weeks. The federal government has not set a deadline, but you should apply as soon as it is published. For more detailed questions, visit this Frequently Asked Questions (FAQ) page from the Student Borrower Protection Center. Until the end of 2025, residents of the state of Illinois will not be required to pay state or federal tax withholding on debt forgiveness.
The Biden Administration also launched a Fresh Start program for student loan borrowers who have defaulted on their loans. Some program benefits are available now and others will be available in 2023 after the payment pause ends. The Department of Education is contacting borrowers who have defaulted to let them know what steps to take, so make sure your student loan servicer has your up-to-date contact information. For more information, visit 's Fresh Start page . the Department of Education
If your loans are covered by the President's order, check with your loan collection company as soon as possible to make sure you're ready to resume payments. A new free online service called Summer can help you simplify your loan payments and maximize your savings.
Automatic, repeat payments
Many people pay their bills through automatic, repeat payments (eg, subscriptions, gym memberships, loans, credit cards). Contact businesses that deduct money through automatic payment to apply for COVID hardship help. They may be willing to temporarily freeze your account. If that is not an option, you have the right to cancel your authorization for the company to deduct the money. You may still owe money to the business, but you can manually control the timing of payment and make payment only after you've paid for essential items.
Credit cards
Major credit card companies have COVID assistance programs. Visit the website of the credit card company. If you can't find it online, call them for help due to COVID. Most companies will allow you to put off paying your bill for a period of time without late payment fees.
medical bills
Call the medical provider/biller and explain that you are unable to pay the bill due to COVID-related hardships and request a payment plan. If you are unsuccessful with a representative, ask to speak to a supervisor who might be able to help you further. Medical providers would rather put you on a payment plan than refer your account to a collection agency.
child support
If you owe child support and cannot make the payments, notify the person receiving the support first. The State of Illinois also provides free child support services. Complete an online application to receive services. You can also call 800-447-4278 or visit any Department of Child Support Services office.
These services can also assist you if you owe child support.
If you are unable to make your child support payments, the court may modify your obligation if you have lost your income or experience some other hardship. The Greater Chicago Law Clinic has a help line to provide more information at 312-796-3070. Illinois Legal Aid Online has an online guide to help you with paperwork.
accounts receivable
Request a payment plan. If you already have a payment plan but can't afford the monthly payments, ask to have the plan adjusted.
Collection agencies would rather you pay something than send your bill to their attorneys to collect through the court system. Staying in communication with them is the most important thing. Collection agencies would rather you pay something than send your bill to their attorneys to collect through the court system. Staying in communication with them is the most important thing. If a collection agency or creditors have sued you or are threatening to sue you, call Legal Aid.
If a collection agency or creditors have sued you or are threatening to sue you, call Legal Aid.
- In Northern Illinois, call Prairie State Legal Services at 888-966-7757 (Mon–Thurs 9 am–1 pm).
- In Chicago or suburban Cook County, call Legal Aid Chicago at 312-341-1070.
- In southern or central Illinois, call the Land of Lincoln Legal Aid at 877-342-7891.
Suggestion! Avoid extravagance
Buy now, pay later is an increasingly popular option for consumers to purchase luxury items and other extravagances. There are significant financial risks with this. Be careful. Be careful.
OPTION 2: SOURCES OF ADDITIONAL INCOME
Many people use a high-cost loan for a major one-time expense. This section includes ways to access additional income without increasing your debt. Before considering a loan, consider these sources of potential income.
Suggestion! Free and Discounted Essentials
Many charities offer free food, clothing, and other essentials. locations Catholic Charities throughout Illinois offer assistance regardless of your religion. A financial advisor can also direct you to resources.
Tax refunds/credits
You Could Be Eligible for Thousands of Dollars in Tax Refunds When You File Your Tax Returns Even if you don't normally file your taxes, you can. The filing date was April 18, 2022, but there are no late filing penalties if you don't owe the IRS money. (IRS). Submit them as soon as possible to receive your refund.
If you received early monthly payments of your Child Tax Credit in 2021, you're probably eligible for the Child Tax Credit in 2022, which you can receive when you file your 2021 income taxes. If you didn't sign up for early monthly payments of the Credit Tax for Children, you can claim the full amount that corresponded to you when filing your 2021 income tax returns.
If you have not received one or more stimulus checks that were issued in 2020-2021, you can claim the Recovery Refund Credit on your taxes to receive it. Many low-income people are also eligible to receive money from the Earned Income Tax Credit (EITC). Find out if you are eligible to receive the EITC .
Filing your taxes online for the current year and using a bank account number for direct deposit will help you get the money much faster. If you didn't file tax returns in the last two years but think you might be eligible for these tax credits, you can still file a paper return for those years to receive past refunds.
Many Americans are eligible for free online tax preparation services . Most programs that help people file their tax returns are available from January through October.
- Visit GetMyPaymentIL.org for more information on how to file your taxes for free and receive your Recovery Refund Credit. They have a hotline (888-553-9777) for people without access to a computer or more complicated questions about their taxes.
- program The AARP Foundation Tax Help provides free tax preparation assistance to people age 50 and older with low-to-moderate incomes. They offer virtual or in-person assistance throughout Illinois.
- In Chicago, Ladder Up offers free tax assistance to eligible families. Ladder Up also has pro bono attorneys available to handle more complicated tax situations.
Cash Assistance Programs
Cook County has announced that its Guaranteed Income Promise Pilot Program will launch in 2022. This program will provide cash payments of $500 per month to 3,250 households for two years, beginning in December 2022. Applicants must be older than 18 years of age, be a Cook County resident, have income less than 250% of the Federal Poverty Level, and cannot be participating in any other guaranteed income pilot program.
The program is open to everyone regardless of citizenship status, and enrollment does not request citizenship or immigration status information. Registration will be open from October 6 to 21.
Visit www.engagecookcounty.com/promise for more information about the program and to sign up for email alerts on the enrollment portal.
The City of Chicago cash assistance program is no longer accepting applications. Depending on the outcome of the current program, the City may launch one in the future.
Assistance with funerals due to COVID-19
The federal government now has a program to reimburse funeral costs for deaths attributed to COVID-19 (according to the death certificate). The maximum benefit is $9,000 per burial. To be eligible, the funeral must have occurred after January 20, 2020. For more information, including required documentation, visit their website . To apply, call 844-684-6333 (multilingual services available). They do not accept online applications.
Payday Check Advance/Early Wage Access
If you are employed, ask your employer about receiving an advance on your next paycheck. There are several apps that offer Early Wage Access (EWA) products . Some of the EWA apps are difficult to navigate; they may try to make you pay a “tip” when you borrow and make it difficult to opt out of it; They might also charge you an extra fee so you can get the money right away.
If you are cash-strapped and use these products, we recommend that you do not tip and, if possible, skip the optional extra charge for immediate payment. In our experience, the money will be in your account in less than three business days.
Another important caveat : These products are for people whose income is enough to pay their expenses, but their cash flow is irregular. If you don't earn enough to pay your expenses, using these, or any loans, for everyday expenses can put you in a cycle of having to borrow again each pay period.
Bottom line : If you don't pay tips or “immediate deposit” fees, you can get free payday advances from these apps. However, because advances are repaid at the beginning of the next pay period, you may get caught in the cycle of having to borrow again.
Iglesia
Many churches provide financial and other assistance. For example, Catholic Charities agencies throughout Illinois have financial assistance programs for families regardless of religion.
Suggestion! Pay attention to hidden fees in cryptocurrencies
Bitcoin and other cryptocurrencies involve risk. Its use is expanding, for example, as an alternative to currency exchanges or remittances (sending), but pay attention to the extra costs and hidden commissions. They often charge high fees at every stage of the process, from putting your money in a cryptocurrency wallet, to buying it on one of the markets, to turning it into cash, and the fees are even higher when you use a cryptocurrency ATM.
Savings
Use your savings. You may have already used all the money you had in a savings account, but you could also have savings in retirement funds (401k, IRA, etc.). Using your savings or retirement accounts is never ideal, but it is a way to increase your income in a big financial emergency. There are tax consequences, and you may have to adjust how you save for retirement in the future. You could consult a licensed accountant or certified financial planner.
sell assets
If you're willing to sell an item (eg, gold jewelry, brand-name clothing, or antiques), consider selling it instead of getting a loan from a pawn shop to avoid paying finance charges. Poshmark is a widely used app for this. Most pawn shops in Illinois charge around 240% APR for a pawn loan.
OPTION 3: LOANS WITH LOWER COST
If you've taken all possible steps and still need help, you should consider a lower-cost, short-term loan. Here are some affordable loan options, all charging an APR of 36% or less.
Pay attention to fraud!
Scammers are always looking for ways to steal from you, but the COVID relief programs have spawned an avalanche of fraud and scams.
- If you get a call or text from someone you don't know about COVID relief, Social Security, student loans, credit removal, auto warranties, or other benefits, there's a high chance the caller is a scammer. Look up the number of the company or agency on your own and call them directly if you are concerned about whether the call is legitimate.
- Electronic messages that require you to click on a link, open an attachment, or provide personal information are very risky.
- Look out for companies that offer "credit repair," "debt management," or "debt resolution." These types of services are often fraudulent.
For more information on fraud, visit the Consumer Financial Protection Bureau website .
your bank
Visit your bank's website, or call to see if they offer emergency loans or loans specially created for those experiencing hardship due to COVID. If you don't have a bank account, visit Bank On Chicago if you live in Chicago. If you live outside of Chicago, visit Bank On Illinois . A financial advisor can also help you open a bank account.
With a certified Bank On account, you won't be charged overdraft fees, but some BankOn accounts don't have certain features, like access to affordable loans, that are only available with the bank's other accounts. Capital One no longer charges for insufficient funds or overdrafts on any of your accounts. Not a Bank On account, the Virtual Wallet PNC account has a feature called Low-Cash Mode that gives customers more time to deposit into their account to avoid overdraft and, for each transaction overdraft, allows customers to choose whether the bank should make the payment or reject it.
Bank loans
CIBC Bank has an affordable personal loan (12.45% APR) called the EasyPath Personal Loan . Even if you are not a CIBC customer, you can still apply for a loan by visiting one of CIBC's branches .
Huntington Bank offers a line of credit to eligible account holders called Standby Cash . The line of credit is up to $1,000 and does not charge interest or fees if the client enrolls in the automatic payment of the loan.
US Bank offers personal loans to customers and non-customers who have a minimum credit score of 660. The interest rate ranges from 5.99% to 18.49% APR.
CDFI or Credit Union
Consider a loan from a Community Development Financial Institution (CDFI) or credit union:
- Capital Good Fund , a nonprofit CDFI, offers a crisis loan that charges 5% APR, with no principal or interest payments for the first three months.
- Great Lakes Credit Union serves Lake, Cook, McHenry, Kane, DuPage, Kendall, Will and Kenosha counties. They offer a loan called Cash-in-a-Flash , a $500 personal loan with no credit check at a 33% rate.
- Self-Help Credit Union offers a variety of banking and loan products for people with good credit or those who want to improve their credit. Call 800-966-7353.
- Community Plus Federal Credit Union serves Champaign, Ford, and Piatt counties. Borrowers who have been members for six or more months may qualify for Emergency Loan the 18% No Credit Check . They also offer free financial advice. Call 217-893-8201.
- Members “First” Community Credit Union serves Adams, Brown, Pike, and Schuyler counties. They offer personal loans with an APR as low as 7.99%. Call 217-223-4377.
- SIU Credit Union serves 26 southern Illinois counties. They offer a personal loan with competitive interest rates. Call 618-457-3595.
- Unified Homeowners of Illinois Federal Credit Union serves all homeowners in Illinois. They offer personal loans of up to $600 with an APR of 18% APR and a term of 12 months, available to new and existing members. Call 773-283-9340.
online loan
Not all online lenders are affordable. However, members of the American Fintech Council (AFC) adhere to responsible lending standards that include charging 36 percent APR or less. All of the following are members of the AFC.
Personal loans
- Lending Club offers business loans, to buy cars and pay for education. . Online or call 888-596-3157.
- Prosper offers loans of up to $40,000 for emergencies, major events, debt consolidation or purchases. Online or call 866-615-6319.
- Best Egg offers personal loans for major events, purchases or debt consolidation. Online or call 855-282-6353.
Banking and loans- SoFi • SoFi offers accounts, personal loans, credit cards, student loans, home loans, business loans, and investment options. Online or call 855-456-SOFI (7634)
For shopping- “Buy now, pay later” can be an affordable option if you can afford monthly or bi-weekly payments. If you miss payments or miss or miss a payment, you could end up in a cycle of bad debt, which could create serious financial problems.
- Affirm offers financing for purchases large and small.
Personal loans and lines of credit- Allies for Community Business for business loans, lines of credit, and counseling. Online or call 312-275-3000.
- Funding Circle offers loans or lines of credit. Online or call 855-385-5356.
- Lending Club for business loans. Online or call 855-846-0153.
You can compare different loan products on Nerd Wallet , but we cannot guarantee that a loan listed on Nerd Wallet will be beneficial to the consumer.
lending circles
In a lending circle, a small group of people contribute money each month and lend each other money at no interest. Loan circles are made up of 6 to 12 people and loans range from $300 to $2,400. Each month, a new member of the lending circle receives the loan until all members of the group have the opportunity. Loan payments are reported to credit reporting agencies to help participants improve credit.
This option is not good for immediate needs or emergencies. A lending circle requires group planning and you may not be able to predict when it will be your turn to receive the loan. However, it could be useful for large purchases that are planned. You can get more information and apply.
credit card advance
Credit card cash advances may be simple, but they are expensive unless you pay them off quickly. Check the website or contact the credit card company to determine what options are available.
Prefer to chat with a live person? Consult a financial advisor.
The . Capital Good Fund Financial Counselor Hotline provides individual financial advice to any Illinois resident Starting at $15 per month, the nonprofit can create a plan with you and can act on your behalf with creditors. They also offer a credit improvement program for $5 per month. Call 866-584-3651 (English or Spanish)
The City of Aurora's Financial Empowerment Center provides high-quality individual financial counseling to low- and moderate-income residents of the Aurora region. More information .
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