Coronavirus and credit scores: Lawmakers look to shield Americans' credit
A new proposal would place a four-month moratorium on negative credit reporting
FOX Business' Edward Lawrence says the White House stimulus proposal could exceed $1 trillion in an effort to support the crumbling economy. Rep. Michael McCaul, R-Texas, later says financial support must be given to workers who need it the most during the pandemic.
As the effects of the spreading coronavirus seep into the U.S. economy, lawmakers are advancing a number of pieces of legislation designed to protect the American worker.
One of those newly proposed bills is an effort to protect individual’s credit scores at a time when many businesses are laying employees off.
Eighteen percent of households said someone in their household had been laid off – or had hours reduced – due to the coronavirus outbreak, according to a recent NPR/PBS NewsHour/Marist Poll of 835 adults.
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To address related financial challenges – like struggling to pay bills on time – Hawaii Democrat Sen. Brian Schatz and Ohio Democrat Sen. Sherrod Brown introduced the Disaster Protection for Workers’ Credit Act, which would place an immediate, four-month moratorium on all negative credit reporting. Protections would be extended for those who suffer lasting financial hardship from the outbreak.
The bill would also provide for free, unlimited credit checks for one full year from the end of the crisis. Schatz and Brown – both members of the Senate Banking Committee – intend the legislation to cover all future major disasters as well.
The measure has already received support from some consumer advocacy groups.
“We commend Sens. Schatz and Brown for introducing this bill, which will do three key things: stop lenders from reporting negative information to credit bureaus, prohibit the credit bureaus from placing negative information on credit reports, and require the bureaus to remove such information if it appears,” Ed Mierzwinski, senior director for U.S. PIRG’s Federal Consumer Programs, said in a statement.
Meanwhile, the Trump administration is considering a number of efforts to provide relief to American families – including direct cash payments. Lawmakers are also looking to boost unemployment insurance checks.