Until the right "help wanted" ad appears, today's pink-slipped workers may benefit from posting their own "help wanted" appeal.
Creditors may agree to ease loan terms when workers need the help to survive a jobless spell.
Sounds simple -- seek and ye may receive. And, lenders routinely encourage contact at the first sign of trouble.
But credit experts warn: Have a plan before you plea.
The bill pileSome workers are entering unemployment with savings, little or no debt, and a solid credit record. Others begin their layoff with less enviable positions on one or all three fronts.
Begin by plotting how long your resources will cover your basic living expenses -- mortgage or rent, food, transportation, food, utilities, insurance.
Consumer credit advocates don't include credit card bills in the barebones expense category. "You prioritize by paying living expenses first, then secured credit accounts, like your auto loan, and then credit cards," says Gerri Detweiler, credit adviser for credit.com.
How deep the bill pile and how your resources measure up against it determine your strategy for asking for relief.
Help! Help!For some, it's immediately apparent that they won't be able to meet even the mortgage payment within a month or two.
As soon as problems loom, call the lender and explain the job loss, says Ben Windust, Wells Fargo Home Mortgage senior vice president. But he concedes: "I can't give a blanket answer on what the lender will do."
When laid-off workers call before they've missed a payment, they typically don't have to provide documentation about their job loss. It's possible to strike a verbal agreement to ease payments for a period, with payback later when the borrower is working again, says Jon Meade, Fifth Third Bancorp vice president. It's when payments are already missed that more documentation is needed for investors who may hold the mortgage note.
Although lenders recommend early contact, Steve Rhode, president of the Myvesta Foundation, a money advisory nonprofit, doesn't hold out much hope that lenders will immediately offer a reprieve. "You have to fall within their policies," he says, and adds that the newly unemployed may not fit into policies that are already crowded with how to handle homeowners nearing foreclosure.
Still, the mounting foreclosures is prompting more lenders to action, counters Windust.
Trouble watchKeep monitoring how your resources are holding out against your bills, with an eye to how likely it is you'll land another job soon.
"As long as you have the money to pay the minimum on credit cards, continue paying, and there's no real credit damage," says Detweiler.
While not advocating ignoring bills, Rhode warns against misallocating scarce cash: "You have to set a line in the sand, whereby if you don't get employed by a certain date, you have to go to plan B. The last thing you want to do is raid savings to pay credit card bills when you need it to pay food and shelter."