CLEVELAND — In addition to the health fears over Coronavirus, workers and business owners are worried how they’ll survive, now that nearly everything is shut down.
Darrell Porter is a casualty of the Coronavirus shutdowns. A line cook at Mabel’s BBQ in Downtown Cleveland, he's now out of work.
We met him outside of Job and Family Services, where he was using one of their computers to apply for benefits. "I have rent, a family to pay for. I have a lot to do," he told us.
And he says filing for benefits has not been easy. When he tried to apply online he had difficulty with his PIN number. And when he tried to call the State line, he said no one answered.
"I've been calling all morning. Since have not had job I've been calling," he said.”
And he says no one is answering the State line. Once he files though, he will get a break. Ohio announced big changes in its unemployment policies because of the Coronavirus pandemic.
At a news conference on Sunday, Lt. Governor Jon Husted said the emergency policy, "will expedite payments to impacted Ohioans and we will be waiving that one week delay for eligible workers."
It's also extending benefits to those who have been quarantined, and exempting the requirements that people actively seek work.
Business owners will also get a break on unemployment benefits – as the taxes they pay for them will be spread out over time.
And small businesses will get an additional boost.
Gil Goldberg, Regional Director of the Small Business Association told us, “We're working with the Governor's office so that he is able to request a Disaster application for Economic Injury loans to small businesses."
Those will be low interest, 30- year loans up to two million dollars, based on how much sales income a business loses.
"The Disaster program is designed to carry these businesses through the rough spots...so they can pay their bills and employees," he explained.
It's a relief for Olympia Robinson, who owns Specz eyeglass store in Cleveland, and says business is down about 40 percent.
“Saturday's are a really busy day for us, but it was like ghost town," she said.
Compounding matters, as an Optician, she has to be in close contact with customers,which these days, most people are avoiding.
"I've been telling my clients 'if you're sick, you do not feel good just stay home, she said.
Fore Information on the new Coronavirus and Unemployment Insurance Benefits, click here.
For employees who have two jobs, but only lost one:
Unemployment Compensation is designed to be a partial replacement of earnings rather than a total compensation for lost wages. An individual may be considered partially unemployed due to the loss of one job, but eligibility for payments will be dependent on earnings for each week of benefits claimed. If earnings for the week are 20% or less of the claimant’s weekly benefit amount, then the full weekly amount may be payable. Earnings over 20% if the weekly benefit amount will reduce the payment dollar for dollar. If the weekly earnings are equal to or greater than the weekly benefit amount, then no benefit will be payable.
Information on Disaster Assistance for Small Businesses, click here
Banks offering Mortgage relief due to Coronavirus, click here.
Credit Card Assistance during the Coronavirus Outbreak, click here.
Additional programs providing assistance, click here :
People are also asking about whether this a good time to refinance because the Feds slashed interest rates. Here is information from New Rez, a company which specializes in housing loans:
“Yesterday, the Federal Reserve lowered the Federal Funds rate to near zero in an emergency action designed to inject some liquidity into our financial markets. Often times, when this occurs, our mutual clients get confused how this relates to the long term mortgage interest rate environment. First, to explain, it is important to note that the Federal Funds rate is an “overnight lending” rate that the Federal Reserve charges banks when they borrow funds from the Fed, typically to clear their negative overnight checking account balances/drafts. When the Fed lowers rates, they are trying to drive down the cost of funds the bank is experiencing, which is ideally motivating the bank to lower short term interest rates they offer clients. Although those could impact short term Adjustable Rate Mortgages (ARM’s), it typically impacts consumer loans (car loans, short term finance type loans, and even commercial loans that are tied to short term instruments or indexes). So, in effect, we do not believe this Fed action will have much impact on the longer term mortgage industry, but may inject some needed energy into our economy.
Having said that, the mortgage bond markets did experience something very unusual last week that the Fed is trying to correct. With rates plummeting a couple weeks ago, the origination market really heated up, as origination's climbed 300%-500%, primarily due to massive refinance volumes. This excess capacity created an inverse supply-demand curve, and at the end of last week, shot interest rates up quite a bit. This is very unusual, and had created a real demand bubble that could not be filled at reasonable rates.
To that end, the Fed has also agreed to buy $700 billion dollars worth of intermediate term treasuries, as well as $200 billion worth of mortgage backed securities (MBS). The idea is that this will provide some additional liquidity and ultimately some stability in the mortgage interest rate world. Longer term, once things slow down, it is likely that we will start to see some signs of slowing (recession), due to the impacts of the Coronavirus. If that comes to light, and everything else remains relatively constant, then we should see long term mortgage rates trend down again, perhaps substantially.
The best advice to give is for all of us to be ready, if that were to occur. This is a fantastic time for borrowers to consider moving up, taking cash out of their current home and paying down other debt, taking cash out and buying a 2nd home or investment property, or simply refinancing their current home. As we have seen many times over our lifetimes, those borrowers that are most prepared, will likely be able to take advantage of the fallout from this market.”