What will happen if the extra $600 a week unemployment benefit, added due to the current COVID-19 pandemic expires on July 31, 2020? This benefit was intended as a temporary measure to help those facing unemployment or were furloughed due to mandatory business shutdowns.
Many of those now receiving unemployment benefits had expected to return to their jobs once the COVID-19 situation abated. However, in recent weeks and days, many states are seeing a dramatic surge in COVID-19 confirmed cases, leading to more shutdowns and furloughs. The numbers of unemployment benefit applications rose last week for the first time since March.
While those on unemployment will still receive state benefits, the extra $600 per week will go away unless extended by Congress. This significant reduction will mean many individuals will find themselves unable to keep up with their financial obligations. If and when another stimulus plans is passed, it will most likely be delay or not as generous causing many to default on current obligations.
As individuals and businesses struggle to meet those obligations, and stimulus payments, small business loans, and unemployment benefits end, it is anticipated there will necessarily be a surge in bankruptcy petitions.
The decision to file for bankruptcy is a tough one and should not be entered lightly. Filing for bankruptcy it will impact your credit for a number of years, and require an entirely new plan for dealing with finances. A bankruptcy attorney can advise on the pros and cons of filing. We offer a no obligation consultation and are here to help guide you down a path to being able to take care of debts and remain above water.