Now What? I’m Behind on My Bills and Need Help!

(3 Minute Read) — While inflation is cooling, it doesn’t feel like it for many of us. Recent surveys reveal about two thirds of Americans feel they are living “paycheck to paycheck,” generally defined as difficulty meeting current obligations if a paycheck was delayed a week. Couple that tight cash flow with an unexpected financial emergency, and you have the risk of falling behind on your bills. 

A report from the Federal Reserve of New York finds that about 9% of credit card balances fell into delinquency last year. The report also reveals about one in five cardholders is “maxed out,” meaning they’ve reached the limit on their credit cards. 

Getting trapped in the debt cycle is nerve-wracking and can be incredibly stressful when trying to prioritize which bills to pay. We turned to the Member Solutions experts here at Unitus to find out exactly what you should do when you’ve fallen behind on your bills. Here are the experts’ answers to our questions. 

I am overwhelmed! What is the first step toward catching up? 

Unitus Member Solutions Team: Call your creditors to let them know and discuss options. Our most common response from members when they contact us is that they don’t realize we could or would work with them! Unitus will work to set up arrangements based on a member’s payday and budget, as will most other creditors. We also offer skip-pays and hardship modifications for those who qualify. 

How do I prioritize which debts to pay? 

Unitus Member Solutions Team: Generally housing, basic living expenses, and transportation are the top priorities. Secured debt (home, car, etc.) is also a priority due to the potential for foreclosure or repossession due to nonpayment. Try to pay the most delinquent accounts first as those are the ones most likely facing collection. Again, speaking with the creditors to discuss payment options is critical and many will pause any drastic action if you contact them and make payment arrangements. 

What’s the best way to create a payment plan? 

Unitus Member Solutions Team: Work with your creditors to see what they will accept. Many will accept revised payment plans and/or hardship modifications. Reach out to one of our free financial counselors (through our partnership with GreenPath) to see if a debt management plan might be a good option. Some creditors will accept these plans (for credit cards, personal loans, lines of credit) with lowered monthly payments and some may even waive fees and/or reduce interest rates to help members pay off debt faster. 

What should I watch out for so I don’t get scammed or ripped off? 

Unitus Member Solutions Team: If it feels too good to be true—it probably is. Look for non-profit or not-for-profit debt counseling services. Most creditors will accept these plans. Avoid any offers that promise to resolve your debt quickly! It takes time to work through a debt management plan, and it’s worth the effort to rebuild credit with existing creditors following resolution. 

How can I budget better in the future? 

Unitus Member Solutions Team: A simple notebook will work! Write down your income and your bills, what time of the month you’re paid and when your bills are due, so you can coordinate what needs to come out of each check. If your due dates are causing issues, contact creditors to see if they can be changed. One of the exclusive member benefits you receive at Unitus is access to free financial counseling, budgeting, and planning. Your financial wellbeing is our top concern. 

How can I rebuild my credit after falling behind? 

Unitus Member Solutions Team: Once your account is current, your consistent payments will be reported to the credit bureaus, and you’ll see your credit score start to improve. We highly recommend keeping track of your credit score within Unitus digital banking. Under “Tools,” click “My Credit Score.” Our trusted partners at GreenPath also offer credit rebuilding courses and counseling at no charge to you. 

How do I get help at Unitus? 

Unitus Member Solutions Team: Respond right away to any calls or notices from us! Call Member Solutions or stop by a branch to speak with a Member Advocate. We have Certified Financial Coaches at every branch and in most member-facing departments. They can provide basic guidance and direct members to Member Solutions for more detailed payment arrangements as needed. Don’t forget, you can brush up on all your financial knowledge for free, just visit our financial well-being page.  

At Unitus, our Member Solutions Team is dedicated to providing the support and resources you need to overcome financial hurdles, rebuild your credit, and achieve long-term financial stability. Remember, you’re not alone—reach out, take action, and make use of the tools and guidance available to you!