Sara Parker, from Utah Central Credit Union, explains a new program that helps guard against life’s unknown.
One such option is a loan payment protection plan which guards against those unpredictable “what ifs” by reducing the loan payment amount or cancelling it all together.
And the good news is these plans are very affordable -costing about $1.50 a month for a $10,000 loan, for example. At Utah Central, the Member’s Choice Payment Protection Plan offers four different options. The optimal package covers loss of life 100% and in the case of disability, payments are also cancelled or interest and program fees are cancelled, depending on the situation. In the case of involuntary unemployment, loan interest and programs fees are cancelled.
The plans cover everything from consumer loans, to home equity loans and credit card payments.
Since payment history makes up 35% of an individual’s credit score, late payments can drastically impact a person’s financial health. A payment that is 90 days late will damage a credit score significantly for up to seven years – whether the past due amount is $100 or $10,000. Creditors view a 90-day delay as a serious red flag, leading to a less than favorable credit score. A payment that is 120 days late will usually be sold to a third party collection agency. A home foreclosure or vehicle repossession also seriously affects credit scores for seven years.
For more information about this program go to www.utahcentral.com.