Protecting your life, the lives of your loved ones and your property are clearly the priority when a disaster or crisis occurs. But, what can you do to protect your credit and personal finances during the Coronavirus pandemic or a natural disaster?

You’ll want to stay vigilant and protect your credit after a crisis or natural disaster, as scams, fraud and other threats may arise. Your credit score may be negatively affected in other ways — the stress of managing basic living expenses, for example, may lead to poor decisions regarding personal financial issues.

Consider a few of these tips to help protect your credit:

  1. Communicate With Your Lender
  2. Revisit Your Budget and Track Your Spending
  3. Avoid Being a Target for Credit Scams
  4. Check Your Credit Report Regularly

1. Communicate With Your Lender

If you’re overwhelmed, it’s possible that some of your bills could slip through the cracks. But, paying late or missing a payment can negatively impact your credit score.

Fortunately, your credit card company or lender may be able to help. “Lending companies are often more compassionate during major disasters than most people would think,” says Antonio T. Smith, Jr.

Smith, who runs a personal development and coaching business in Galveston, Texas, has firsthand experience dealing with credit issues following Hurricane Ike in 2008 and Hurricane Harvey in 2017.

“[Lenders typically] have programs set up to ease the burden of payments and often can forgive late payment fees, or even move unpaid balances back a month or more,” Smith says. But, as he points out, “This can’t happen if the consumer isn’t communicating with their lender.”

In other words, keep your creditors in the loop if you’ve been affected by a disaster. Discuss your options for keeping up with your payments sooner, rather than later. And, make sure they have a current phone number and email address for you on file so they can get in touch with you easily.

2. Revisit Your Budget and Track Your Spending

Natural disasters or something like the current pandemic could throw a wrench in your budget if you’re not able to return to work right away. You also could run into trouble if you’re footing the bill for evacuation costs, home repairs or basic living expenses that aren’t covered by insurance, or while you’re waiting on reimbursement from your insurer. You may also be waiting for unemployment benefits.

Your emergency fund may only go so far in these instances. A credit card or loan could help cover the gap, but be careful not to end up overextended on credit.

“Natural disasters can force people to borrow more than they can afford,” Smith says. Between home repairs, car repairs, food, medicine, doctor’s appointments and all the other expenses associated with maintaining a basic standard of living, the costs can add up quickly.

Approximately 30 percent of your credit score is based on your credit utilization, says Money, which is the ratio of your credit balance to credit limit. The higher this number climbs, the more points it may knock off your credit score.

Revising your budget and keeping track of what you spend may help protect your credit after a natural disaster. Smith suggests using credit card alerts to maintain awareness of your spending and balances. “When you don’t have much money, each purchase alert is a gentle reminder that you need to monitor your spending and be careful of going over budget,” he says.

Credit card alerts also can be helpful for protecting your score in another way: They might clue you in to potential scams and/or identity fraud after a disaster.

3. Avoid Being a Target for Credit Scams

“Credit scams have always popped up during and after a natural disaster, but in today’s data-rich age, they’re going to increase considerably,” says Jason Glassberg, co-founder of Casaba Security, a cybersecurity advisory firm based in Redmond, Washington.

Credit scams can take a number of different forms after a disaster and phone scams are among the most common. Phone-based scams tend to work best when people are already stressed out, says Glassberg, making natural disasters a ripe opportunity.

“The standard tactic in a phone scam is to get the other person into an emotional frame of mind, instead of a rational one,” he says. “This makes them more vulnerable to bad decisions, like handing over a credit card number or sharing a password.”

Glassberg says phone scammers often use high-pressure tactics to get what they want. Following a disaster, these may include:

  • Claiming that an insurance payment was missed and that a policy won’t cover your losses unless a payment is made immediately
  • Requesting your bank account number to deliver government-funded disaster aid via wire transfer
  • Claiming that fraud was detected on a credit card account and they need to verify your personal and account information

Strategies like these may be more effective if you’re frazzled after a disaster. Glassberg advises being very careful, especially when responding to an unsolicited call. The same rule applies for emails, which can often disguise phishing scams.

“The most important piece of advice for consumers is to never give out personal information during an unsolicited call,” says Glassberg. “Even if your caller ID says the call is from [a reputable insurance company], you should hang up and call [the company] directly from its publicly listed number.”

Be on the lookout for scams closer to home as well. Home contractor and insurance scams can increase in areas that are heavily hit by natural disaster damage.

Smith says the best way to protect yourself against these types of scams is by asking for proper identification and credentials before entering an agreement for services with a contractor or public insurance adjuster. Most importantly, don’t hand over your credit card information without making sure the person you’re giving it to is legitimate.

4. Check Your Credit Report Regularly

It’s generally a good idea to check your credit report regularly, but it becomes even more important following a natural disaster.

“People should check their credit following a natural disaster for any negative impacts, fraudulent activity,” Smith says,” because the opportunity to become a victim of fraud or scams will be at its highest within 30 days after the disaster.”

In addition to checking your credit report, keep an eye on your score as well. Use your credit card’s free credit score access (like Discover’s Credit Scorecard) if it’s offered. And, check your card for other security features that can help you protect your credit after a natural disaster.

Discover, for instance, offers the Freeze it® feature, which allows you to temporarily lock your account if you suspect fraud. You also can sign up for free Social Security number alerts, which can notify you if your personal or financial information is potentially being misused.

Recovering from a natural disaster can take days, weeks, months — sometimes even years. In the meantime, taking action to avoid damage to your credit can help make your journey back to normalcy a smoother one.

Published March 11,2019.

Updated May 11, 2020.

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