Protecting Your Credit During the Coronavirus Crisis


July 27, 2020



Financial Education

At Merck Employees Federal Credit Union, our top priorities are the health and safety of our employees, members and their families. While your health and welfare are top priorities, you may also be concerned about how current economic conditions might affect your financial situation. We encourage you to be proactive in monitoring your credit, staying on top of your personal finances, and using resources that may be available to you. The federal government has provided guidance for lenders to give consumers a break on some of their monthly bills during the coronavirus crisis—without reporting them as delinquent or past due. The basis of this is to let consumers skip payments without damaging their credit scores. However, individuals should be more vigilant than usual about monitoring their credit reports and scores. What is a credit score? A credit score is a three-digit number, typically between 300 and 850, designed to represent your credit risk, or the likelihood you will pay your bills on time. Credit scores are calculated using information in your credit reports, including your payment history, the amount of debt you have, and the length of your credit history. Higher scores mean you have demonstrated responsible credit behavior in the past, which may make potential lenders and creditors more confident when evaluating a request for credit. Are all borrowers eligible for credit protection under the new law? No. The credit-related provisions of the law apply to borrowers who receive “accommodations” from their lenders, such as a temporary suspension of monthly payments or a reduction in the amount due. Most federally backed student loans and mortgages are eligible for the payment relief that triggers credit protection. Delaying Loan Payments? Deferring your loan payments doesn’t have a direct impact on your credit scores. It may be a good option if you’re having trouble making payments. Putting off your payments can impact your finances in other ways, though. Your loans may continue to accrue interest, and you might pay more in the long run or have larger monthly bills once you resume making payments. It still may be a worthwhile trade-off compared with missing a payment altogether, which could lead to late payment fees and hurt your credit. Additional steps you can take now to protect your credit

  1. Pay all your bills on time if possible. While we know it may get difficult, try to make at least your minimum debt payments by their due date every month to avoid hurting your credit score.

  2. Lenders may be able to temporarily lower your interest rate or payment amount, or pause your payments for a period of time. As discussed above, lenders may also be able to place your loans in deferment or forbearance.

  3. Check your credit regularly. Especially now, making sure your credit reports are accurate is critical. This way, you can identify any potentially fraudulent activity and respond to it before it damages your credit. Through April 20, 2021, Experian, TransUnion and Equifax will offer all U.S. consumers free weekly credit reports through to help you protect your financial health.

  4. Dispute information online. Disputes need to be made with each credit bureau where the information you’re disputing appears.

  5. Be extra vigilant about protecting your identity. Identity theft and related scams often spike during times of crisis, so it’s especially important now to protect your personal information.

Financial Wellness in Uncertain Times

Take charge of your financial decisions!

Related Articles


Now More Than Ever, Members Should Be Aware Of Potential Financial Scams

2021. Merck Employees Federal Credit Union. 

All Rights Reserved.

Privacy Policy






Site Map