Federal Employees Getting Advice About Managing Debts While Out of Work

Debt collectors may want to start preparing to receive a lot of letters and phone calls from furloughed federal employees who will likely start falling behind on their bills as a result of the government shutdown.

In fact, to help ease the burdens being felt by the nearly 800,000 employees who are not working as a result of the shutdown, one branch of the government is offering some resources to help keep creditors and collectors informed and offering to pay reduced amounts on their debts until they go back to work.

The U.S. Office of Personnel Management, an independent agency in the federal government that manages the civilian workforce, tweeted out a series of tips and even a sample form letter that government employees can send to creditors and collectors.

Feds, here are sample letters you may use as a guide when working with your creditors during this furlough. If you need legal advice please consult with your personal attorney. https://t.co/t6h6OzALsS

— OPM (@USOPM) December 27, 2018

At the very least, the advice recommends that individuals reach out and contact their creditors, mortgage lenders, and other organizations to which a debt is owed and be open and forthright about the situation.

The sample letter that could be used to send to creditors — which should follow a phone call from the individual to the creditor — read like this:

Dear (Name of Company or individual with whom you have spoken)

This is to confirm our conversation of (date) in which we discussed a temporary reduction in my monthly payment.

As we discussed, I am a Federal employee who has recently been furloughed due to a lack of funding of my agency. Because of this, my income has been severely cut and I am unable to pay the entire cost of my monthly payments, along with my other expenses.

As we had agreed in our conversation, I will be able to make regular payments in the amount of $_______. I realize that I will be responsible to pay the remainder of the payments and, when I return to work, I will contact you immediately to work out a plan to take care of the reduced payments. I will also keep in touch with you to keep you informed about my income status.

I appreciate your willingness to work with me and your understanding during this difficult time.

A growing number of federal employees are falling behind on their payments and there are no signs that the shutdown will be over anytime soon.