Joshua Zimmelman, president of Westwood Tax & Consulting in Rockville...

Joshua Zimmelman, president of Westwood Tax & Consulting in Rockville Centre, said, if a creditor grants you a deferral, get evidence.  Credit: Rachell Banez

Some hardship programs that allow people to defer monthly payments on credit cards, home, car and student loans during the pandemic offered by creditors have proved problematic for folks who thought they were a godsend.

The credit reporting provisions in the CARES Act basically preserves the status of an account at the time a payment deferral or other accommodations was granted. “So if you were current at the time of the accommodation, you should continue to be reported as ‘current’ if you comply with the terms of the accommodation,” said Chi Chi Wu, a staff attorney with the National Consumer Law Center in Boston.

But according to the hundreds of consumer complaints filed with the Consumer Financial Protection Bureau, moving from idea to implementation has not gone smoothly, as people with deferral or forbearance agreements say that creditors reported them as having late payments to the credit bureaus and had their credit scores lowered.

“This has been happening way more than it should be! A significant number of our clients were marked late even though they spoke with their creditors and advised them that they were going to be putting payments in deferral. The credit card companies still marked them late and their credit took a dip,” said Adem Selita, co-founder of The Debt Relief Company in Manhattan.

Selita said in an email, “Credit card companies should not be doing this since they are not allowed (by law mind you) to be marking anyone late since the onset of the pandemic, especially if the consumer reached out and made them aware of any hardship.”

Michael Foguth, founder of Foguth Financial Group in Brighton, Michigan, said, “Lenders are looking for revenue. This is a 100% money grab.”

What recourse do you have? Some are turning to the courts.

Leslie Tayne, a debt resolution attorney with the Tayne Law...

Leslie Tayne, a debt resolution attorney with the Tayne Law Group in Melville, said student loan holders should check their credit report to see if an error was reported.  Credit: Newsday/John Paraskevas

“The servicer Great Lakes Educational Loan Services erroneously reported to the credit bureaus that many student loan holders had missed payments during the CARES Act loan payment suspension period. A class-action lawsuit has been filed against them and the three credit bureaus,”  said Leslie Tayne, a debt resolution attorney with the Tayne Law Group in Melville. 

In an email statement to Newsday, Great Lakes said it was “committed to resolving the issue quickly.”

Ben Kiser, managing director for the servicer’s communication services, said, “On May 6, Great Lakes reported repayment borrowers to the credit reporting agencies in a manner it believed would not have a negative impact on borrower credit scores.” On May 11, after Great Lakes began receiving questions from borrowers about their credit scores, Kiser said,  “Great Lakes began researching these borrower accounts and determined there was an inconsistency between Great Lakes reporting and that of other student loan servicers. Instead of reporting borrowers as current with monthly payments of $0, Great Lakes reported borrowers as current with deferred monthly payments of $0.”

Kiser said Great Lakes has “let our borrowers know we would adjust the inconsistency in reporting with the credit reporting agencies immediately.”

Tayne said student loan holders should check their credit report from all three bureaus, Experian, TransUnion and Equifax to see if an error was reported. She added that until April 2021, you can check reports from each bureau weekly for free on

To dispute an error on your credit reports, get in touch with the credit bureaus. To initiate a dispute for Experian, go to the Dispute Center on Experian’s website,, or call the number listed on the Experian credit report. To do so for TransUnion, go to or call 833-395-6941. For Equifax, go to Equifax’s website,, or call 866-349-5191. If you use free credit monitoring tools such as Credit Karma, you can also dispute information directly from their website.

You can appeal a change to your credit score by submitting supporting evidence to the credit bureau (for example, showing a written agreement that you were granted a deferral on monthly payments, not just late on your payments). You can submit a complaint to the U.S. Consumer Financial Protection Bureau here on their website,

Protect yourself 

How can you get the relief you need and not have it come back to bite you? “Explain your specific situation to your lender and not automatically assume there is an extension. Working with your credit card company is key,” said Paul Miller, founder of Miller & Co. in Manhattan.

Get the facts. “How will the creditor report to the credit bureau, will they still charge interest during the deferment period and what happens to the missed payments at the end of the deferment period,” asked Katie Bossler, quality assurance team lead for GreenPath in Farmington Hills, Michigan.

Joshua Zimmelman, president of Westwood Tax & Consulting in Rockville Centre, said, if a creditor grants you a deferral, get evidence. “Don’t just speak to someone on the phone, ask for it in writing. If they then report you to the credit bureau, you have evidence that they were in the wrong.”

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