As April 1 approaches and monthly bills come due, many Marylanders during this unprecedented period of economic pain may be doubting their ability to meet their financial obligations.
For those cash-strapped Marylanders who have lost their jobs or seen their financial stability take a hit in the wake of the COVID-19 outbreak, state Comptroller Peter V.R. Franchot (D) has a suggestion: Ask your creditors, your landlords, your utility companies for a 90-day payment holiday.
“Don’t write checks to your creditors until you talk to your creditors,” Franchot said in an interview Friday. “It allows consumers to preserve what’s in their pockets in a normal time.”
The advice isn’t fail-safe: Not everyone will agree, Franchot concedes. After all, several business owners, including some landlords, are taking major financial hits themselves these days.
“I can’t get into the business of promising a happy result,” Franchot said.
Still, he said, there is no harm for consumers in asking and trying to negotiate — whether they’re dealing with a big corporation or a small business: “Most of us don’t have the self-confidence to call our creditors and say, ‘would you be willing to give us a 90-day holiday?'”
For businesses, Franchot theorizes, there is incentive in working out a payment schedule with customers who are hurting financially.
Kathleen Murphy, president of the Maryland Bankers Association, said in an email that Franchot’s idea isn’t so far-fetched. In fact, she said, the 87 community, regional and nationwide banks across Maryland “are poised to help their customers experiencing a financial hardship as a result of COVID-19.”
The bankers association and individual banks have publicized their desire to help on social media and on their websites, Murphy said. “We also set up a special coronavirus resource center on our website with links to our members’ coronavirus resource pages as well as to their branch, digital, ATM and call center access information and contact information,” she wrote.
Maryland banks are already waiving fees, deferring payments, offering low or no-interest loans and many other measures to help their clients get through the emergency depending on their specific needs, Murphy continued.
“There is no one-size-fits-all solution and that’s why the outreach is so important — so the best solution can be tailored to meet specific needs and circumstances,” she said.
Thomas Dennison, Government and Public Affairs director for Southern Maryland Electric Cooperative, said the utility is also willing to work with its ratepayers who are struggling financially. In fact, he said, helping consumers “weather the storm” is part of the co-op’s “usual process.”
“We’ve communicated publicly that we’re going to work with our customers through their hardships,” Dennison said. “We’ve done it before, through the [federal] government shutdowns.”
One consequence of the crisis taking place in spring, he added, is that customers aren’t running up the high energy bills that they would if it were mid-summer or the dead of winter.
Even with the $2.2 trillion federal economic aid package signed into law, it could take weeks before taxpayers and businesses start seeing any relief. Franchot continues to urge Gov. Lawrence J. Hogan Jr. (R) to release $500 million from the state’s rainy day fund for additional financial relief.
The comptroller’s office, like the IRS, has delayed the deadline for taxpayers to file their 2019 returns until July 15. At the same time, businesses are being allowed to skip their monthly tax payments from March, April and May until at least June 1.
But Franchot said it would be difficult for state government to mandate and enforce guidelines requiring businesses to offer their customers a three-month payment holiday, so a voluntary system would work better. And Franchot, a skilled public relations practitioner, urged consumers who are not getting the desired relief from companies if they request it to take to social media to publicize their cases.
“People don’t like to read about the fact that they’re not generous,” he said.