Unemployment benefit cuts may cause need for credit repair

Michigan consumers who are struggling with bad credit may see some immediate help from new legislation.

Governor Rick Snyder recently signed a measure that will reduce unemployment benefits for state residents in order to allow them to become eligible for additional federal employment benefits. While the move may help current unemployed individuals by allowing them to obtain up to 20 additional weeks of federal financial aid, opponents of the measure, such as U.S. Rep. Sander Levin, say it will result in problems for these residents down the road, The Associated Press reports.

This is because these federal benefits are slated to expire at the end of the year. If they are not renewed, then unemployed Michiganians will miss out on federal aid, in addition to having six fewer weeks of state assistance. Michigan is currently the only state in the country that has 20 weeks of unemployment insurance.

With less state aid available for Michigan residents in need, consumers may have to find other ways to get their finances and credit in order. One of the first steps they should take is to check their credit reports to determine the status of their current debt obligations. This will allow them to create a plan to pay off any troublesome accounts.

During their review of their credit document, these individuals should also look for any questionable or errant items that may be unfairly lowering their credit score. In some instances, a debt collections agency or creditor may report the wrong information to the credit bureaus. When this happens, consumers may benefit from working with a credit repair service to investigate and dispute the marks.