These are stressful and uncertain times. In addition to dealing with a national health emergency, millions Canadians have been suddenly thrown out of work.

If you are one of them and you are suffering financial hardship because of COVID-19, there are powerful new initiatives that can help. Here are four major ones to consider.

Collect the new $2,000-per-month job-loss benefit

The federal government is rolling out a new job-loss fund called the Canada Emergency Response Benefit (CERB) that is intended to get cash into your hands as quickly as possible.

It pays $2,000 every four weeks and covers just about everyone who has been thrown out of work since March 15, whether normally eligible for Employment Insurance (EI) or not. Benefits can last up to 16 weeks. Some four million Canadians are expected to receive this benefit.

The massive backlog of unprocessed EI claims for people who lost their work since March 15 will now be covered by CERB and paid at the CERB rate (regardless of what the EI benefits would have been).

If you previously submitted an EI application that is stuck unprocessed in the backlog, there is no need to apply for CERB. Those previous EI applications should now be processed quickly under the streamlined CERB rules.

All other applicants should apply directly for CERB benefits through the Canada Revenue Agency this week online or by phone according to a schedule based on month of birth: Monday, April 6 (January-March); Tuesday (April-June); Wednesday (July-September); Thursday (October-December).

The government says it will start your CERB benefits within 10 days of application. Unlike the complex EI process, CERB is designed to be simple and straightforward, with minimal documentation required (including no need for a medical certificate). However, you may be required to produce documentation later to confirm information you provided. It is also a good idea to set up direct deposit through your CRA My Account to speed up receipt of funds.

CERB covers the self-employed as well as regular employees, part-time as well as full-time, whether EI contributors or not, who have been forced out of work for at least 14 days since March 15. It includes those out of work for a variety of situations, including those who aren’t receiving income but haven’t officially been laid off. It covers those quarantined, but also those who have had to look after a sick relative or a child because of closed daycare. You need to have had at least $5,000 in income in 2019 or the 12 months prior to your application.

You can’t receive both CERB and EI (regular or sickness benefits) for the same period. The cutoff is March 15 for determining whether someone normally eligible for EI gets CERB instead. (Since EI’s complicated eligibility rules for benefits includes the stipulation that you be out of work at least seven days before you’re entitled to get regular EI, that means that if you were thrown out of work during the week prior to March 15, you might be covered by CERB rather than regular EI. On the other hand, the one-week waiting period for EI sickness benefits is currently waived for people in quarantine, so cutoff timing in that case works differently.) While CERB pays a set $2,000 every four weeks, EI regular and sickness benefits are normally 55 per cent of earnings up to a maximum of $573 a week or $2,292 every four weeks. So CERB sometimes pays more than EI and sometimes pays less.

That will no doubt lead to some disgruntlement if you’re caught on the disadvantaged side of the cut-off line by a few days. That’s particularly the case for someone who became eligible for EI just prior to March 15 and then was approved for a very small EI benefit, thus missing out on a bigger CERB benefit by a few days. That in turn may cause the government to tweak the cutoff rules to lessen some of the larger discrepancies caused by small differences in timing.

Of course it can work the other way for people who would normally be eligible for the maximum EI of $2,292 every four weeks but are forced to take a modestly reduced CERB benefit of $2,000. In that case the government has said it is not considering any adjustment. However, those who get CERB and are EI eligible may qualify for EI payouts that apply after CERB benefits are finished.

Other EI benefits (maternity, parental, caregiving, fishing and worksharing) will continue to be covered by EI and are not replaced by CERB.

CERB is administered by the Canada Revenue Agency, whereas EI is administered by Service Canada. I would suggest having an online account with both if your application involves both organizations.

Defer your mortgage and credit card payments

The banks and other financial institutions have launched wide-scale programs to allow out-of-work borrowers to defer payments on mortgages for up to six months. Interest accrues on those deferred payments and both will have to eventually be paid.

“It’s going to keep a lot of people from going over the edge,” says Robert McLister, founder of RateSpy.com, a mortgage news and rate comparison site. Canada’s largest six banks have received almost 500,000 mortgage deferral requests, said the Canadian Bankers Association on Friday. That is more than 10 per cent of the mortgages those banks hold.

Although the federal government has nudged the banks to do this, the program is voluntary and applications are considered on a case-by-case basis.

The banks have been swamped by deferral requests, but appear to be reasonably accommodating once borrowers get through the queue and have their request assessed.

“For most cases that I’ve heard of, people are getting approved for mortgage deferrals if they have an interruption of income,” McLister says, adding those who are “just worried” about losing their job likely won’t get approved at this point.

“The biggest issue is Canadians being able to get in contact with their lenders due to overwhelming demand,” says Alyssa Furtado, co-founder of Ratehub.ca, a financial-product comparison site, based on feedback from Ratehub’s front-line staff.

A mortgage deferral entails a modest payment bump at some point down the road to account for the deferred payments and extra interest. Some banks are bumping the payments at the end of the deferral period, while others are doing it when the mortgage renews. With interest rates under downward pressure due to the crisis, lower interest rates at renewal may well offset the impact of catching up on deferred payments.

Be sure to get approval for a mortgage deferral before you skip any payments to avoid hurting your credit rating, Furtado says.

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The banks and other financial institutions are also offering potential deferrals on credit card and other loan payments.

In the case of credit cards, each of Canada’s six largest banks said in a series of announcements on Friday and Saturday that they would reduce interest rates by roughly half on the deferred credit card payments of clients suffering financial hardship due to COVID-19.

The potential payment deferral period ranges from one to six months. Big bank credit card interest rates on unpaid balances in normal times are typically an exorbitant 19.99 per cent to 20.99 per cent annualized. The new reduced annualized interest rates on the deferred payments are typically between 9.99 per cent and 10.99 per cent, which makes it more tolerable as a temporary stop-gap source of credit if you lack lower cost options. Get your payment deferrals approved by your bank before your next payment due date to avoid being charged the higher regular interest rate.

Defer your rent

Many landlords have voluntarily provided rent discounts or deferrals to help tenants who are hard-hit by the crisis.

But as the result of recent actions by the Ontario government, you essentially have leeway to defer your rent payments even if your landlord doesn’t agree to it.

That’s because the Ontario government has shut down the process of evicting tenants due to nonpayment of rent, with no timeline as to when it will restart.

The province has “put a pause on forcing people from their homes,” is how Kenn Hale, legal director for the Advocacy Centre for Tenants Ontario, describes it.

“Keeping people in their homes is important not just for those individuals, but also for the rest of us,” Hale says. “We don’t want people potentially infected wandering the streets looking for a place to live, knocking on doors, inspecting apartments.”

The province ordered a halt to enforcement of eviction orders by sheriff’s offices in mid-March. In addition, the Landlord and Tenant Board, which must authorize landlord eviction applications before they can proceed, has suspended all eviction hearings (except in special cases involving safety or illegal acts).

The “pause” in evictions for new cases could last for months. Prior to the COVID-19 crisis, there was already a backlog that served to delay evictions for about two-and-a-half months from the date of a missed rent payment to an eviction hearing. Even after the eviction halt is lifted and the Landlord and Tenant Board resumes regular operations, new eviction applications added to the backlog will probably push those timelines longer.

Of course at some point you will need to catch up on missed rent payments or be forced to vacate. So far at least, governments have no plans to subsidize or dictate any form of rent forgiveness, although in some cases you may be able to negotiate a deal with your landlord.

Under Ontario landlord and tenant law, you can bring yourself current on rent by paying the accumulated back rent any time prior to eviction. Your landlord can’t charge you overdue fees or interest on back rent that you owe. “Late fees are completely illegal,” says Geordie Dent, executive director of the Federation of Metro Tenants’ Associations.

Take more time to pay the CRA

While this benefit applies to every individual taxpayer, those who owe the Canada Revenue Agency but are out of work will probably appreciate it the most.

Your 2019 personal income tax return due date has been pushed back from April 30 to June 1. If you owe money, the new deadline to pay the CRA without penalty is Sept 1. If you have a tax refund coming, it makes sense to file as early as you can to potentially get the money earlier.

David Aston , a freelance contributing columnist for the Star, is a personal finance and investment journalist. He has an M.A. in economics and is a Chartered Professional Accountant. Reach him via email: davidastonstar@gmail.com

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