Lenders cut some slack

• By CHAD CALDER
• Advocate business writer
• Published: Sep 7, 2008 - Page: 1B - UPDATED: 12:05 a.m.

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For the most part, Baton Rouge area residents busy dealing with the aftermath of Hurricane Gustav can expect some leniency with their monthly bills, but it is recommended they contact lenders, utilities and credit card companies as soon as possible.

The Federal Reserve said Friday that it is encouraging banking organizations to work with borrowers in communities affected by Gustav, a perfunctory but significant step because the regulatory agency is telling lenders it understands there are extenuating circumstances that will affect their operations.

Jim Lestelle, of Lestelle Communications, a banking industry spokesman for more than two decades, said Fannie Mae and Freddie Mac hold most of the mortgage loans in the U.S.  and have not yet made an announcement about forbearance — the process of helping financially distressed borrowers avoid losing their homes.

That, he said, could come next week.

Credit card companies — American Express, Visa and MasterCard — recommend customers contact their card issuers, a step seconded by Capital One and Chase.

Capital One spokeswoman Pam Girardo said the company is waiving late and over-the-limit fees and penalties for insufficient funds under its hardship policy. While this can be done retroactively, she recommended customers call as soon as they can.

“We get that there are bigger priorities,” she said.

Telephone companies similarly followed suit.

Sprint spokeswoman Kristin Wallace said the company is waiving late fees and overages automatically, so customer contact is not necessary.

Verizon, on the other hand, is working with customers on a case-by-case basis, though it is holding off on contacting customers late with their payments, said spokeswoman Gretchen Lejeune.

AT&T also said it will work with customers, but is also waiving its fees to move a customer’s land-line service to a new or temporary location, as well as the fee to move it back. It is also offering a free month of voicemail service, remote access, call forwarding and others.

Alltel did not respond to a request for comment.

Cox spokeswoman Sharon Kleinpeter said the cable, Internet and telephone service provider is suspending collection activities and stopped issuing late fees as of the date of the storm. It will credit accounts based on service outages and will not mail bills until it does so.