This One Question Can Lower a Bill Fast
Bills are, unfortunately, part of life. But what happens when you’re struggling with yours or when you can’t pay at all?
According to the Bank of America Institute, 24% of U.S. households are living paycheck to paycheck. This means that any surprises are often left unpaid or incur debt. Even everyday expenses can be a major burden. There is a simple solution. Ask the organization billing you this simple question.
Do You Have a Hardship Program?
A hardship program is a short-term repayment arrangement made between you and the company billing you. You might have heard them called “loss mitigation programs” or “forbearance," and can ask again under one of these terms if the contact hasn't heard of it by another name.
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Whatever you call it, a hardship program is a form of temporary financial relief. Under such a program, your creditor might:
Lower your interest rate: This also means a reduced monthly payment, so you have a little more wiggle room in your budget. The lowered rate might be temporary or last until you repay your entire balance.
Postpone your payments: The program could postpone your payments while you get a handle on your finances. The postponement might only last a month, but sometimes it’ll last longer.
Waive certain other fees: If you’ve fallen behind on payments, you’ll likely be charged late fees or penalty APR. A hardship program could potentially prevent these fees.
Reduce your bill altogether: Sometimes, a lender or creditor will agree to settle your debt for less than what you owe. This comes with its pros and cons, but could be an option if you’re running out of options.
Not everyone is eligible for hardship programs. Usually, you’ll need to prove your financial hardship. Not every company even offers them, but asking if it does won't hurt.
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The Script That Works (According to Reddit)
So, how do you ask for a hardship program and get the company to say yes? This largely depends on the bill and provider.
Take medical bills as an example. The average medical debt on credit reports is over $3,100, as per the Consumer Finance Protection Bureau. That’s a lot, no matter who you are, and it's way up from $2,000 in 2022.
On Reddit, user “mycoffeecup” shared how they managed to lower their medical bills.
“I owed a large amount to several medical providers but wasn't able to pay it all at one time and was on very low income,” they wrote. “I put them all on a spreadsheet, the name of the office or the doctor, the total amount owed … all of that information.”
From there, they called each office and said this:
They were attempting to arrange payment plans for 17 providers.
They didn’t have the income to pay everyone at once.
They intended to pay the provider who gave them a “very affordable” payment plan first (since they’re unable to pay all of them at once).
They might not have the money needed by the time they reach the end of their list, which is why they’re calling to try to arrange a “very small” monthly payment.
According to “mycoffeecup,” some of their medical providers gave them $5 to $7 monthly payment plans. One couldn’t go below $15. In the end, though, they managed to pay everything off.
The Script Works on Non-Medical Bills, Too
What’s great about this script is that you don’t have to limit it to medical bills. It can work for utility companies, credit card issuers or even your mortgage lender.
In the case of your mortgage, your loan might end up in forbearance. This is a temporary pause (or reduction) on your monthly mortgage payments. You’ll still owe the original amount, but you can pay it back later. Interest usually still accrues during the forbearance period, so keep that in mind.
If you intend to ask for a hardship program, start by getting organized. Put your debts in order and know who you need to contact before ever making that first phone call. Have a clear explanation as to why you need a hardship program. Be up-front with your intention to repay what you owe, but don’t overpromise. Honesty can go a long way to getting the arrangement you need.
One other thing to keep in mind is that shame has no place when it comes to your finances. If you need help and you can’t get on a hardship program, call “211.” This is a national helpline that can connect you to the financial resources you need — from food banks to utility help. These resources exist for you to use, and taking advantage of them if you need them actually helps such entities prove they're doing good work for the community where they're needed.
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This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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