Debt is always a concern, but when you are unemployed it can seem like an insurmountable obstacle. You can’t escape your financial obligations, and if you fail to meet them, you can suffer severe consequences. But, debt is meant to be managed, even when you are unemployed. The first and most important step is to realize that you are not powerless and that you have options available to you. Even when unemployed and without a steady income, you can keep up with your debts without hurting your credit score.
Prioritize Your Debts
Odds are, you have a variety of different debts ranging from a mortgage on your home to credit card debt. Before you do anything, you need to know what all your debts are and how much you owe. Some debts have a more immediate importance than others. If you don’t pay your mortgage, you lose your place to live. If you don’t pay your credit card bill, you might lose the card. If you have to prioritize in the short term, make sure you pay the debts that impact your ability to obtain your basic needs.
Negotiate With Your Creditors
Creditors do not want you to fail in your repayment. They do not get paid unless you make payments. It might be in their best interest to allow you to pay a lower amount in the short-term so they can recover the full amount of what you owe later. When it comes to mortgages, many banks are under pressure from the federal government to grant all reasonable requests for debt modifications. Certainly the loss of a job qualifies. A debt settlement company can help with this as well. The more you can knock off of your immediate debt payments now, the more likely you will be able to keep afloat until you find a new job.
Determine if You Can Get Help
Being unemployed is hardly a new condition, and there are organizations available that can help you get through the tough times. The federal government is particularly helpful in this regard. Depending on your household income level, you can obtain financial support in paying your utility bills, hospital bills and medical costs. This is in addition to approximately a thousand other federal benefits programs available to people in times of need. See if there is a non-profit credit counseling organization in your area. These groups are the best equipped to counsel you on what to do and to find the programs that best fit your circumstances.