House Passes HEROES Act

HEROES Act

The House of Representatives passed a $3 trillion stimulus bill on Friday, May 15, with a 208-199 vote. The more than 1,800-page legislation, dubbed the Health and Economic Recovery Omnibus Emergency Solutions Act (Heroes Act), would provide another stimulus check to qualifying Americans, extend unemployment benefits, and provide relief to homeowners, among other economic stimuli.

The HEROES Act needs to be approved by the Senate before passing into law. However, the Senate will not be voting on the aid package until after the May 25 Memorial Day recess. In addition, Senate leadership has called the bill “dead on arrival” and many senators have threatened to oppose its passing.

Here’s what’s inside the proposed legislation:

1. Economic Impact Payments of up to $6,000 per household

The second round of stimulus checks included in the HEROES Act are structured similarly to the first payments, with individual tax filers phasing out of eligibility at $75,000-plus, and couples filing jointly phasing out at $150,000-plus.

The proposed second economic impact payment varies from its predecessor in two areas. Firstly, the latest stimulus checks will grant $1,200 for each dependent, regardless of age, for up to three dependents per household. Secondly, immigrants with taxpayer identification numbers will be included in the payments, unlike the first round.

2. Expanded and extended unemployment benefits 

While some states have made the first tentative steps toward reopening their economy, a record 33 million Americans are still out of work. The HEROES Act would provide relief to these individuals, offering expanded unemployment coverage of an extra $600 per week through January 2021. The bill also extends eligibility benefits for gig workers, independent contractors, part-time workers and the self-employed through March 2021.

3. Student loan forgiveness 

The original plans for a broad $30,000 in student loan forgiveness have been scrapped from the legislation, but the HEROES Act includes the following provisions for student loan relief:

  • $10,000 in federal student loan forgiveness.
  • $10,000 in private student loan forgiveness.
  • An extension of the CARES Act suspension of payments, interest and collections on government-held federal student loans through September of 2021. These protections will also expand to include commercially-held Federal Family Education Loan federal student loans, as well as Perkins loans.
  • A modification to Public Service Loan Forgiveness that would allow payments made on previously-consolidated federal student loans to potentially count towards the 120 qualifying monthly payments required for the program.

The Democratic House leaders made a last-minute amendment to these provisions, restricting eligibility for student loan forgiveness to students who are “economically distressed.” The term has been defined as someone who, as of March 12, 2020, was delinquent or in default on their student loan, in economic hardship deferment or forbearance on their student loan, or in an income-driven repayment plan with a monthly payment amount of $0.

Rental and mortgage assistance

The HEROES Act will provide $100 billion of rental assistance for the country’s 40 million-plus renters. The funds will be distributed through an existing nationwide grant rental assistance program that would verify a tenant’s inability to pay rent and issue vouchers to cover the cost of rent and utilities. The legislation will also extend the moratorium on residential foreclosures and rental evictions for 12 months.

In addition, the HEROES Act also expands the protection for homeowners included in the CARES Act, providing an additional $75 billion for a homeowner assistance fund designed to prevent mortgage defaults and property foreclosures.

Hazard pay for essential workers

The HEROES Act would establish a $200 billion “Heroes’ Fund” to provide hazard pay to qualifying essential workers. The fund will furnish a $13 per hour pay premium on top of regular pay for “all hours worked in essential industries through the end of 2020.” The hazard pay caps at $25,000 for essential workers earning less than $200,000 per year, and at $5,000 for workers earning more than $200,000 per year.

Other provisions and benefits 

The HEROES Act includes several additional economic relief provisions, including:

  • Close to $1 trillion in direct financial relief for state, local and tribal governments.
  • $75 billion for coronavirus testing and tracing.
  • Increased spending on Supplemental Nutrition Assistance Program (SNAP), Temporary Assistance for Needy Families (TANF), and Women, Infants, and Children (WIC).
  • Debt-collection relief.

The Complete Guide to Prioritizing Bills During COVID-19

Prioritize your bills

If you are one of the millions of Americans on furlough thanks to the coronavirus, you may be scrambling to cover your bills. Let’s take a look at what Freedom’s financial experts are advising so you can make an informed decision about your finances going forward.

Triage your bills

Freedom recommends putting your most basic needs, including food and shelter, before any other bills now. Make sure you can feed your family before using your limited resources for loan payments or credit card bills. Similarly, your family needs a place to live, so mortgage or rent payments should be next on your list.

Housing costs

In early March, the Federal Housing Finance Agency offered payment forbearance to homeowners affected by COVID-19, allowing them to suspend mortgage payments up to 12 months. These loans account for approximately 66 percent of all home loans in America. They will eventually need to be covered, though conditions for repayment vary by lender.

Speak to your lender about your options before making a decision.

If you’re a renter, be open with your landlord. They may be willing to work with you.

Paying for transportation

Missing an auto loan payment can mean risking repossession of your vehicle. This should put car payments next on your list of financial priorities. If meeting that monthly payment is impossible right now, it’s best to communicate with your lender and come up with a plan that is mutually agreeable to both parties.

Household bills

Utility and service bills should be paid on time each month, but for workers on furlough due to the coronavirus pandemic, these expenses may not even make it to their list of priorities.

Most states have outlawed utility shutoffs for now. Also, many providers are willing to work with their clients. Visit the websites of your providers or reach out to them by phone to see what kind of relief and financial considerations they’re offering consumers.

Unsecured debt

Unsecured debt includes credit cards, personal loans and any other loan that is not tied to a large asset. Struggling Americans can place these loans at the bottom of their list of financial priorities for now. At the same time, borrowers should know that missing out on a monthly loan payment can have a long-term negative impact on a credit score.

Here, too, consumers are advised to communicate with their lenders about their current financial realities. Credit card companies and lenders are often willing to extend payment deadlines, lower the APR on a line of credit or a loan, waive a late fee or occasionally allow consumers to skip a payment without penalty.

Freedom Federal Credit Union is committed to putting our members first, not shareholders, and helping you achieve your financial goals. Learn more at freedomfcu.org or call us 800-440-4120 to see how we can help.

Your Turn: How are you prioritizing your bills during the pandemic? Share your tips with us on Facebook, LinkedIn,Twitter, or Instagram.

 

Stimulus Payment Scam

Coronavirus CARES Act

Millions of Americans have received or are awaiting a gift from Uncle Sam to help them get through the coronavirus pandemic. As part of the Coronavirus Aid, Relief and Economic Security (CARES) Act passed on March 27, the federal government is sending out $290 billion in Economic Impact Payments (EIPs) via stimulus checks or ACH deposits over the next half a year.

The first round of checks and deposits made its way to millions of checking accounts across the country during the second week of April and the next round is expected to be sent within a few weeks. The remainder will be mailed out or deposited via ACH over the following 20 weeks.

Unfortunately, scammers are doing all they can to get their hands on this money before they reach the rightful recipients. The best way to keep your money safe from scammers is to arm yourself with information about the stimulus payments and to learn how to spot the scams.

To help you keep every dollar that’s coming to you and avoid falling victim to these scams, Freedom FCU has compiled this important information on the stimulus payment process and the connected scams. For additional answers to Frequently Asked Questions, visit our Coronavirus Support page‘s Economic Impact Payment (EIP) section.

Important information about the stimulus checks

Many Americans aren’t aware of this crucial fact: You do not need to take any action to receive your stimulus payment. There is no form to fill out, no number to call, and no information to share. Every eligible citizen should receive the check without having to take any action.

The feds are using the most recent tax filing information they have from each eligible citizen to send out the checks. They will use information from 2019 tax returns to determine the payment amount and get recipients their money. Those who haven’t yet filed taxes this year (the tax deadline has been extended to July 15), will have the information from their  2018 taxes used. Social Security recipients, and anyone else not required to file taxes, do not need to take action either; the government already has their information on file.

There is no need to share information, such as a Social Security number, checking account number or home address, with anyone. There is no need to “sign up” for your payment either. All you need to do is wait for your check to land in your mailbox or in your account. Remember the simple rule: There is no need to take any action to receive your check.

When you may need to take action

The only exception to the above rule applies to those who have not yet filed taxes for 2018. These citizens may need to submit a simple tax return to receive their check.

Also, the government has shared that it can only deposit the money directly into checking accounts if it has this information on file for the recipient. This criterion includes nearly all citizens who’ve received a tax refund for the taxes they filed in 2018 or 2019. Individuals receiving their payments via direct deposit will likely have their money sooner. Consequently, many people want to share this information with the IRS before the payments are sent out. It can be done via this link, which can also be used to look up the status of your check. Unfortunately, though, many people have reported that the IRS site has not been working properly recently, which is likely due to heavy traffic.

How the scams play out

The scammers trying to nab stimulus money count on victims thinking they need to take action to get their payments. They use a variety of means, including phone calls, emails, text messages and social media posts, to ask victims to share information that will allegedly enable them to receive their funds. They may ask for the victim’s Social Security number, date of birth, PayPal account information, checking account details, home address or other personal information, claiming it is a necessary “sign up” step in the stimulus payment distribution.

Alternatively, they may claim they can help you receive your payment earlier through their website if you share certain information with them. They’ll often use sophisticated spoofing methods to make it appear as if they are legitimate government representatives. Once they have this information, though, they will reach out to the IRS to change your information so your check goes directly into their own accounts. Or, they may hack your account to withdraw the stimulus money as soon as it arrives.

If you receive any phone calls or messages asking for your personal information so you can receive your payment, you are looking at a scam. Do not respond. Report the scam to the FTC at ftc.gov. The federal government has made it clear it will not be reaching out to citizens and asking for information before sending out payments. It has also shared that there is no way for anyone to gain early access to the stimulus payment money.

Stay safe!

Your Turn: Have you been targeted by a stimulus payment scam? Tell us about it on Facebook, Twitter or Instagram! @FreedomFedCU