Recent Questions From Our Live Twitter Q&A – Credit Sesame
We recently held our first live Q&A on Twitter to answer your questions about navigating finances in this challenging time. We received lots of great questions about everything from the stimulus checks to refinancing mortgages, so we wanted to share an overview here for people with similar inquiries.
We are planning to host these live Q&As every Thursday in April at 3:00 pm ET/12:00 pm PT, so please join us while using hashtag #SesameChat! We are ready to answer your questions and provide the best resources. Meanwhile, Credit Sesame could be a free valuable resource that will help you monitor your money over these uncertain times.
Questions About Stimulus Payments
Who will get the stimulus checks?
All legal People in america who filed tax returns for either 2021 or 2021 qualify. The number you receive will depend on your overall income from prior tax filings. Tax filers with adjusted revenues as much as $75,000 for people and as much as $150,000 for married people filing joint returns will receive the full payment. To ascertain if you are entitled and calculate just how much you could receive, visit our stimulus calculator.
Will we be taxed on the payments?
You will not need to pay taxes on your stimulus payment.
What is taken into consideration with the amount you will receive with the stimulus checks?
It depends on your revenues out of your 2021 tax filing. If you haven’t filed for 2021 taxes yet, the IRS will make reference to your 2021 filing. The amount you will get also depends upon the number of qualified dependents younger than 17.
Is the stimulus bill a one time thing?
For now, it’s a one-time payment. Future government bills could mean other payments.
Will these stimulus checks be deposited into my banking account basically have previously filed taxes?
The IRS will deposit the stimulus payment in to the same banking account in your tax return. If you’d prefer to alter the form of payment distribution, an IRS web portal will soon be available to do so.
With extension to file your taxes, will waiting to file for affect you getting a stimulus check?
If you’ve filed your 2021 taxes, the IRS will use that to find out your stimulus payment. Otherwise, they’ll use 2021’s, so waiting to file for shouldn't impact whenever you receive your payment.
For more details, go to the IRS website.
Questions About Prioritizing and Paying Bills
Should I contact my lenders individually if I have issues repaying loans?
Yes, you should reach out to them individually to put an agreement in position so that your credit score isn't negatively impacted. You can learn more about banks offering relief options and look for their contact information here.
Are banks currently offering accommodations for those impacted by COVID-19?
Several finance companies and banks are providing temporary relief, but it's vital that you contact them first to place an agreement in place. Don’t just skip a payment. We've put together a list of banks with their contact details here.
If you have got to the point where you have to prioritize bills, which bill should you prioritize first?
You should get in touch with your lenders or providers to see that has forbearance programs and who not. If you can defer some payments, that can help you decide which to pay now. Here is a list of utilities and cable companies providing relief.
If student loans are deferred, should you still pay if you can or will you get penalized for deferment?
For federal loans, you shouldn’t be penalized but it’s important to get in touch with your lender to put an agreement in place to safeguard your credit rating. If you're able to manage to pay at the moment, you should preserve to make payments as always.
Is there going to be leniency for hospital bills?
We would recommend reaching out to the medical billing department of the provider to go over your choices. Many are prepared to work with you and also set up a repayment plan.
Questions About Loans and Interest Rates
Should I refinance my home?
Rates are historically low at this time with a few lenders-in the low-3% range. Due to this, lenders are experiencing a massive number of applications. Some lenders have artificially high rates, so it's best to seek advice from multiple lenders to ensure you're getting the best rate.
Is now a good time to consolidate credit cards or get a low interest loan?
Our general take is that it is not a great time at this time, aside from individuals with fairly good credit. Many personal loan lenders are pulling back and also have tightened their underwriting requirements. However, if you want an extra buffer to pay bills or buy essentials, you may want to look into an emergency credit card with a low interest rate.
Is right now a good time to refinance loans?
It depends on the borrowed funds. Mortgage rates, for example, are lower now, but unsecured loans have become more difficult to get. We’ve outlined strategies for different kinds of loans here.
Questions About Protecting Your Credit Score
If you get a mortgage deferment, will that create your credit score to lower?
You should seek advice from your lender first and set a contract in place. Many government-backed mortgage loans will have a forbearance program, so you should speak to your lender to better understand your choices. With proper arrangements, your score shouldn't generally be impacted.
Will it affect my credit basically settle payments late due to COVID? I understand many organisations are providing no late fees with no cut-offs, but what about my credit?
Although many companies are offering relief, you should contact them to place a contract in position. Just skipping your instalments may impact your credit rating, however, you ought to be protected if one makes the proper arrangements.
If my credit history is just two years old, so how exactly does it affect my approval chances?
In addition to your credit score, lenders take many factors into account, for example period of employment and income, when determining loan approval and rates of interest. A young credit history shouldn't be an issue if you have a powerful payment background and high grades in other factors. Discover more regarding your credit score and also the different components by logging into your free Credit Sesame account. Without having a Credit Sesame account yet, consider signing up to stay on top of your credit.
Questions About Savings and Retirement
How much emergency cash do you want?
It depends upon your situation, expenses, and dependents. Experts have recommended saving at least 3 months of expenses. If you have money left over after your necessary expenses, setting it aside for emergencies could be a great option.
Should you move money in your 401(k) or let it rest alone and adding to it?
In general, you should avoid withdrawing money from your 401(k) if you don't need to as a last measure or else you are of retirement age. In case your employment is stable, you can also seek advice from your employer to ascertain if a 401(k) loan is definitely an option.
If you withdraw money from investments or 401(k) are you penalized?
If you’ve been impacted financially by COVID-19, the CARES Act waives the 10% early withdrawal penalty. So you can withdraw up to $100,000 and not be penalized if this sounds like required to pay your expenses.
We anticipate answering more of the questions you have during our live Twitter Q&As in April!