COVID-19 is a law that was passed in October 2018, but its effects are still being felt by consumers. What does the COVID-19 mean for you? Does it affect your business and how should you be preparing? We have laid out what you need to know as part of our guide to protecting yourself from this new pandemic.
Consumers turn on their federal, state, and municipal governments for help during times of crisis. In addition, many customers are searching for methods to save money at this time since they are unemployed.
Fortunately, numerous new consumer protection regulations have been enacted to assist individuals who have been affected by the coronavirus epidemic.
According to the National Consumer Law Center (NCLC), various steps are being taken to assist customers who are coping with the effects of the coronavirus. The initiatives include a range of relief attempts, including a federal moratorium on foreclosures, Department of Education action on student loans, and state-enacted price gouging legislation. Other measures address critical consumer protection issues impacting money and other vital elements of daily life in these difficult times.
See whether you’re covered by some of the consumer protection measures listed below!
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The ‘‘CARES” Act is a federal consumer protection law.
The Coronavirus Aid, Relief, and Economic Security Act, commonly known as the “CARES” Act, is one of the most significant relief measures undertaken by the federal government. This law proposes making direct payments to Americans in 2019 depending on their earnings. Measures to improve unemployment insurance, business loans, and hospital assistance are also included in the bill.
The CARES Act was passed by the Senate on March 25, and the House submitted it to President Trump for his signature this morning.
Foreclosures are being put on hold.
During this crisis, homeowners who own houses may get foreclosure letters from lenders. Some state and federal agencies are stepping in to help individuals who need consumer protection in their homes, which is where we will be spending the most of our time throughout the worldwide pandemic.
The CARES Act, as stated above, also includes provisions for dealing with the possibility of a moratorium on mortgage foreclosures. Fannie Mae, Freddie Mac, the Federal Housing Administration, Veteran’s Affairs, and the United States Department of Agriculture’s Rural Home Loan Service are all eligible for the proposed law’s foreclosure relief.
Whether you’re not sure if your loan is backed by the government, there are many methods to figure out if one of these organizations is in charge of your mortgage. There are search websites for Fannie Mae and Freddie Mac, for example, to see whether they hold a mortgage. Furthermore, most mortgage bills will indicate the customer whether they have a house loan with one of the above-mentioned companies.
Once you’ve figured out which business owns your home’s mortgage, you may be able to contact them and work out a solution to prevent foreclosure. Homeowners with a federally backed loan may seek forbearance from their debt for up to 180 days under the CARES Act. Homeowners may then ask for an extra 180 days of forbearance. Borrowers will not be charged any fees, fines, or interest during this period.
If consumers are facing eviction or foreclosure, they may turn to their states for help. According to the NCLC, several states have enacted legislation that has restricted or temporarily halted foreclosures.
Alaska, for example, has temporarily halted all court eviction procedures. In California, the state has delegated the decision to continue eviction procedures to local governments, while in Connecticut, all foreclosure processes planned for May or April 2020 have been postponed until June 6, 2020.
Meanwhile, beginning March 20, 2020, no eviction of any residential or commercial tenant or foreclosure of any commercial or residential property will be enforced in New York according to the governor’s Executive Order. Furthermore, a judge’s administration order states that all eviction procedures would be postponed until further notice beginning March 16, 2020.
Student Loans from the Department of Education
Student loans from the federal Department of Education are another consumer protection concern that people should be aware of. Consumers may be concerned about repaying college debt that has built up over time. While struggling with decreased income, Americans may be able to turn to the federal government and other lenders for help.
The US Department of Education published information for individuals who had loans with the department on March 20, 2020. The government has stated that for the next 60 days, all borrowers with federal student loans will have their interest rates set at 0%.
Student loan debtors may also have their payments delayed for at least two months, according to the Department of Education. Consumers will not have to worry about making payments on their student loans and will avoid accruing interest as a result of this.
Terminations of phone services are being postponed.
Cell phones are one of the ways that customers communicate with one another during the coronavirus outbreak. While we are stranded at home, staying in contact with friends and family members may be a benefit. During this time of need, consumers will rely more on their mobile phone providers to keep them connected.
Many Americans may be concerned about paying their payments on time since they were laid off during the epidemic. Fortunately, the federal and state governments have agreed on a number of consumer protection measures to avoid the termination of service.
According to the NCLC, the FCC has received assurances from about 1,000 telecommunications providers that they would not terminate service owing to a sixty-day inability to pay due to the coronavirus. Furthermore, the FCC has said that businesses would waive any late penalties owing to inability to pay due to the coronavirus and will offer their hotspots to the general public.
Utility Disconnections Have Been Suspended
The prospect of losing water, power, and other essential services during a disaster is terrifying. Authorities have tried to allay these concerns, just as they did with the phone service customer relief measures. During the crisis, half of the states in the US have allegedly halted utility terminations, with additional states expected to follow suit.
In addition, a number of utility firms have put a stop to company-wide disconnections. Ameren, American Electric Power, Duke Energy, Evergy, FirstEnergy, Georgia Power, NV Energy, PECO, PG&E, Southern California Edison, Xcel Energy, and others are among these businesses.
Competitive electricity utilities’ door-to-door sales have also been restricted in certain areas. In-person sales of electrical services are illegal in Pennsylvania, whereas in-person marketing and other door-to-door sales interactions are outlawed in Illinois.
Another element of crises that may be harmful to consumers is price gouging. Businesses that wish to profit from the crisis may raise prices on basic goods like fuel and food supplies. As a consequence, customers may find themselves unable to purchase goods that they need to get through this crisis due to financial constraints.
A customer recently launched a class action complaint against Amazon, alleging that the firm was overcharging for specific goods like toilet paper and hand sanitizer. Amazon was reportedly charging $99 for 36 toilet paper rolls and $199 for two 1 liter hand sanitizer bottles.
Consumers in two states have been affected by price gouging laws.
To combat price gouging, the Massachusetts Attorney General has proposed a consumer protection legislation change. The original legislation only protected petroleum products against price gouging; however, the revised statute now includes “any commodities or services essential for the public health, safety, or welfare.”
In addition, Wisconsin has warned that if payday and licensed lenders raise interest rates or fees in reaction to COVID-19, their licenses may be suspended.
Banking and Consumer Credit Extended by Banks
Consumers may also be interested in boosting their credit or avoiding credit declines during these periods. Consumers who wish to be financially secure in the future and have money on hand should maintain good credit.
According to the NCLC, federal bank regulators are requesting that banks work with customers to eliminate some fees, raise credit limits for certain borrowers, and provide payment concessions, such as altering the terms of certain loans, owing to financial hardship caused by COVID-19.
Similarly, New York has proposed a new rule that would require banks in the state to provide forbearance on loan payments for 90 days to those who are experiencing financial difficulty as a result of COVID-19. Consumer fees are also limited as a result of these efforts.
All in-person chapter 7, 12, and 13 section 341 sessions planned until April 10th, 2020 have been postponed to a later date. Other modifications to bankruptcy protection guarantee that businesses may continue to make payments despite the COVID-19 epidemic.
Class Action Lawsuits for Consumer Protection
Consumers should also be aware of the coronavirus class action lawsuits that have just been launched. Consumer protection laws have been used by ordinary Americans, groups, and even corporations to defend themselves and their interests throughout the coronavirus epidemic.
One such class action case, for example, concerns the manufacturer of Germ-X hand sanitizer. The Germ-X manufacturers were falsely promoting its hand sanitizer as beneficial in preventing customers from the coronavirus, according to the class action complaint. The plaintiffs in the lawsuit allege that the marketing approach exploited them.
Consumers may also be interested in a lawsuit filed by travelers against Princess Cruise Lines, alleging that the cruise line did not do enough to prevent the coronavirus from spreading to guests during their trip. The Diamond Princess and the Grand Princess, two of the company’s ships, have been connected to coronavirus outbreaks.
Consumers should be wary of any business that claims to be able to treat the coronavirus by selling medicines or other types of therapy. To prevent customers from being duped, medical practitioners and healthcare authorities have taken action against misleading promises. A lawsuit has been filed against televangelist Jim Bakker, who is accused of selling a bogus COVID-19 “cure.”