Banks move to help federal workers hit by closure

Assistance includes low or no interest wage advances and loans for workers facing diminishing cash reserves.

A total of 800,000 federal employees have been raised or worked without pay since December 21, and will not receive the next paycheck until the government opens again.

"Our observation is that the people we serve are not wealthy people," said Scott Spiker, CEO and CEO of First Command Financial Services, whose clients include members of the Coast Guard.

While the home security ministry found money to pay coast guard salaries at the end of December, future paychecks are uncertain whether Congress and President Donald Trump cannot find a border-wall finance agreement.

On Monday, a federation representing federal workers sued the government to demand that some employees be considered "essential" to work without pay.

Assistance to Federal Employees

Spiker told CNN that senior command offers its members who are federal employees interest-free pay advances, as well as other assistance.

Democracy Federal Credit Union offers a short-term emergency loan of 0% interest, says lending manager Antoine McStay. Bankers also address customers with specific concerns about their internal financial advisory services, he said.

Other institutions, such as the United States Bank and Transportation Federal Credit Union, have said they will provide low-interest loans to their clients.

USAA spokeswoman Laura Propp told CNN that "thousands" have come out to the bank for help or advice.

Many workers can begin to feel pinch just now when the closure extends into a new pay period.

Spiker added that for many of the bank's customers, "their large payouts coincide with their checks" at the beginning and mid-month ̵[ads1]1; including mortgage payments, car loans and utility bills.

"Many have payments that they are trying to land on 1.," he said.

Gloria Bowden, executive vice president of Democracy Federal Credit Union, said that a lack of paycheck gives a "domino effect".

"If they are not paid, their loans are not paid, which puts them in overdue or offensive status," she said, who can damage credit or cause bad fees.

Entrepreneurs may not be eligible for assistance

While federal employees usually receive repayment after the government reopens, federal contractors often do not.

This means that lenders may not expect contractors to quickly repay the loans or advances, and offers to federal employees such as the Democracy Federal Credit Union emergency loan are not available to them.

Assistance to contractors is a "traditional bank equation", explained Spiker of First Command. Entrepreneurs will demand more scrutiny than federal employees "to understand their future ability to pay."

McStay said Democracy Federal Credit Union offers contractors other options, such as delaying payments on existing loans.

  LES: Sample letters the government suggests volunteer workers can send to their creditors
The Agency for Personnel Administration was widely criticized after being issued a copy of the Federal Employees can send to creditors asking for forgiveness or flexibility. Suggestions that included offering manual labor instead of payment.

While open to creditors, it is true that Spiker said the OPM recommendation to government officials to swap services like painting "in exchange for partial lease payments" rings hollow.

"It's a very difficult position to put people in," Spiker told CNN. "In many cases, for these people, they are not trained to be dealers, and there is not a widespread marketplace that says," Give, landlords, be good citizens and all chip in. ""

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