Too many payday loans consolidation? Here’s everything you should know
Pretty much everyone can get a payday loan, but not everyone can quickly get out of a payday loan trap in the most affordable way.
With the price of living going up each day, so many low and middle-income earners find payday loans as an easy way out during emergencies.
While these loans may seem like the best thing during financial distress, getting out of their snare is always a daunting task for many borrowers.
If you are thinking of taking a payday loan, rethink that decision, and if you’re already chest deep in multiple loans, this article will offer you all the loan help you need.
Let’s dive in Why is it so easy to get trapped in a payday cycle?
What if you have too many payday loans consolidation? Picture this scenario; let’s say you took out a loan of $500 payable in two weeks.
When your paycheck finally arrives, you need to cough out $600, which is the $500 principal plus interest of $100.
Remember you still have other bills like grocery, rent, health insurance, and other daily expenses to pay out from this salary.
You then begin to panic and wonder how you’ll get by to the next paycheck. And when an emergency hits like a car break down, you go back to the payday lender and decide to roll over your loan.
The lender then takes the $100 interest, but the $600 remains unpaid. By end month, you still don’t have the $600 to clear off your debt.
You then run to another lender because you cannot rollover your loan twice.
This cycle continues until it gets out of hand and before you know it, you are trapped in a debt cycle that is not only financially draining but emotionally draining as well.
The high-interest rates and short repayment schedules make it difficult for most borrowers to clear off their loans as fast as they’d wish to.
They, therefore, end up renewing their loans and accrue more fees and interest. So how do you escape this debt trap?
It’s quite easy if you have never taken out a payday loan, don’t take out one, and instead look for alternative sources of cash if you need financial help.
Below are some reasons why you don’t need to take out these loans:
There’s no guarantee that you’ll have the cash by end month
Taking out a payday loan with the hope that you’ll pay it back with your next paycheck is not a good idea.
If you don’t have that $500 now, chances are that you may not have it in two weeks time.
You may receive your paycheck, yes, but it could be tied up with nothing left towards your debt obligation.
You’ll then have no option, but to roll over your loan to the next paycheck, and that’s how the debt cycle begins. The costs may get out of hand
Payday lenders charge double interest rates and APRs, and they have structured these loans in such a way that they are so expensive and difficult to repay.
They’ll allow you to roll over your loans as many times as you want to as long as you keep paying the interest and loan renewal fees.
You’ll also be expected to pay in full by end month, and if you can’t, they’ll only charge a finance fee which does not reduce your debt in any way.
If you authorized automatic debits, they’ll keep withdrawing from your bank account even if there’s no money in it, and this will cause you to incur overdraft charges and bounced checks fees.
Without realizing it, you will have incurred more expenses than you intended to borrow. Leaves you vulnerable
Most the lucrative adverts you see are not from direct lenders.
They are usually from third party companies who sell your details to these lenders.
Once you fill out their application forms with your details, you’ll start receiving calls from several lenders selling you their offers. Some payday lenders are scammers and operate illegally
Despite the laws put in place to regulate the payday industry and to protect vulnerable citizens, some payday lenders still operate unlawfully and charge very high-interest rates.
They’ll lie to you about their charges, interest rates, and APRs to make you fill out their forms only for the truth to come and bite you later.
By then, you’d have signed the loan agreement form, and you will have no choice but to pay the loan amount in full. They’ll impact your credit score negatively
The truth is, if you apply for a payday loan, it means your credit score sucks.
If you fail to pay back the loan, your credit will deteriorate further.
Usually, when you cannot pay your loans, the lenders will forward your account to debt collection agencies.
The debt collectors will keep hounding you with calls and issues threats of a jail term to get you to honor your debts.
Some may even slap you with a lawsuit that’ll also cost you more than you anticipated.
If, you already have multiple loans, here’s the loan help you need to gain control of your finances once more:
Make a list of all your creditors and how much you owe them
Before you begin paying off your loans, sum up the entire amount owed plus their interest rates.
This will give you an idea of all the debts you have and help you make a plan on how to clear them off. Pay off the loans with the highest interest rates first
Paying off the most expensive loans first helps you save some bucks.
Usually, when the interest piles up, it becomes even more expensive and difficult to clear off the loan. Make a budget and stick to it
The best way to monitor your income and expenditure is to make a budget detailing how much you earn vs. all your expenses.
It would do you so much good to scrap off unnecessary expenses to free up some cash towards your debt obligations. Make a sacrifice to only pay for necessities. You can always plan for special events like parties or vacation when you are debt free. Change your spending habits
The best way to get out of debt faster is to change your spending habits.
If you cannot do it on your own, seek help from a credit counseling agency. They’ll help you prepare a budget, advice you on how to reduce your credit utilization rate and how to live within your means.
Having the right mindset about money will help you know how to make it, keep it and even grow it. Save up some cash for rainy days
Life is unpredictable, and sometimes things happen when we least expect.
It’s wise to have some money in an emergency fund that’ll help you out when you are stuck.
You can always start small by saving at least $10 per week and increase the amount gradually.
Have this amount directly debited from your paycheck. Have multiple streams of income
To be debt free faster, you can do other jobs besides your day job to earn more money.
Find out something that you are good at and offer those services at a fee.
You can use the money you earn to clear off your debts. Instead of borrowing, put off expensive purchases until your paycheck arrives
No matter how tempting it is, don’t borrow to buy something that can wait.
Offers will always come, and those gadgets or clothes will still be there. It won’t hurt to put off the purchase until you get your salary. Don’t roll over your loan no matter how cash-strapped you are
Resist the temptation of adjusting your loans.
It will only prolong your pains.
You’ll end up with more debts than you intended to borrow because any time you adjust your debt, you pay renewal fee plus interest on the previous loan while the loan balance remains the same. Ask to negotiate before your details are forwarded to collection agencies
Some lenders are lenient and may agree to break your payment to flexible and affordable monthly payments.
Attempt to reach out to your lenders and ask if they can allow you to pay your debts in bits.
What if you still cannot pay off your debts despite doing your best?
As a borrower, you have a moral obligation to pay off the loan as agreed in the loan agreement form.
Sometimes, however, getting out of debt may be difficult no matter how much you try.
To protect yourself and your accounts when you find yourself in such a situation, here’s what you have to do:
Revoke all authorizations you gave the lender
To protect your account form automatic withdrawals by the lender, you can contact them to stop the direct debits.
You need to contact them in writing and keep a copy of the letter as proof in case they fail to grant your request.
You can also direct your bank to stop any automatic withdrawals from your account. Don’t be intimidated by threats from debt collectors
If debt collectors keep hounding you with calls, stay calm and ask them to verify if the debt they are calling you about is yours, how they arrived at the amount you owe and if the lender is authorized to issue loans in your state.
Don’t be cowed by their threats and let them know that you have your rights, and that next time they try threatening you, you’ll report them.
No debt collection company has the right to contact your family, or employer regarding your debt, and if the threats persist, report them to the Better Business Bureau or the financial regulatory agency in your state. Always honor a court sermon
Some lenders will go to extremes and slap you with a lawsuit.
In this case, get a credit lawyer to give you legal advice but never ignore a court sermon.
Plead if you have to with the judge and ask the creditor for a settlement plan that’s affordable.
Having a judgment reported to credit agencies may hurt your credit. Ask for payday loan assistance
If you get overwhelmed by multiple loans, you can seek for debt relief through a debt settlement or payday loan debt consolidation.
Both means of debt relief have their pros and cons so, it’s important to choose what suits you most.
Debt settlements Debt settlement involves contacting third-party companies to negotiate with lenders on your behalf to allow you to pay a portion of your debt and pardon the rest.
The debt settlement company will also talk them into wavering all the accrued interest and additional fees.
You’ll then stop making payments to creditors, and instead, start saving in an escrow account that’s monitored by the settlement company.
Once you have raised a substantial amount, they’ll contact your creditors and negotiate on an amount.
If the lenders agree to the plan, which they rarely do, the debt settlement company will go ahead and pay them a lump sum of the amount agreed, charge their fee, and you’ll walk away debt free.
On the surface, it looks like a good deal and a faster way to clear your overwhelming debts, but it has its risks.
Some of the risks are:
Most lenders may not agree to such arrangements
Usually, the debt settlement company contacts your lenders after you have saved some money with them.
There is, however, no guarantee that the lender will agree to such settlement plans.
Most lenders want their money in full and will not negotiate. It will hurt your credit further
Lenders are never aware of any arrangement when you stop payment because the debt settlement company usually contacts them much later.
They’ll treat your missed payments as delinquent accounts and report them to the credit bureaus.
Such information on your credit reports will further deteriorate your bad credit.
The forgiven debt will also show on your files, and this will take 7 years to fall off your reports. You’ll end up paying more
While saving up money in the debt settlement account, your lender will continue charging you interest and additional fees for missed payments. Some lenders may even take legal action against you.
You’ll have to pay off these expenses which will drain you more.
The IRS also treats forgiven debt as income, and that means you’ll have to pay tax for the canceled loans. Some debt settlement companies are a scam
The worst thing that can happen to you is to lose money while you’re still deep in debts.
Some companies will let you save money with them but never contact your creditors to pay off your debt.
Before engaging any debt settlement company, make sure it’s licensed, trustworthy and has a clean track record.
You can always check customers’ reviews before contracting them. You may be forced to pay for unsettled debts
The debt settlement company may never settle all your debts.
They, however, will require you to pay their fees as agreed.
Usually, they charge a percentage of all settled debts.
If for example you had debts amounting to $10,000, and the company only clears $5,000, they’ll still charge your 50% of the unsettled debts.
This is so unfair.
Debt settlements can still be beneficial, and some of its advantages are:
It’s better than filing for bankruptcy.
You clear your debts and walk debt-free faster.
It takes off a huge debt burden off your shoulder. It’s, however, not logical to pile all our credit card balances, payday loans, or students debts with the hope that your debts will be pardoned. Payday loan debt consolidation
This means transferring your debt obligations to another lender.
All you need to do is add all your payday loans into one loan.
So, instead of paying multiple lenders at varying interest rates, you’ll direct all payments to one lender at reduced and affordable monthly payments. How payday loan debt consolidation works
Once you enroll in a consolidation program, you’ll narrate your problems to the debt consolidator assigned to you.
They’ll then ask you to list all the loans you owe plus their interest rates and advice you on the options you have depending on your financial position at the time.
Once that has been established, they’ll advise you on the right loan amount to take and at what rate. The plan is to get you reduced interest rates and a monthly payment plan that’s both flexible and affordable to you.
You’ll then pay off all your payday loans, student loans, and credit card debts with a single check, and focus on one lender. Advantages
With debt consolidation programs, you can:
Reduce your chances of being slapped with a court order – By paying off your payday lenders, you not only gain control of your finances and get out of the debt trap, but you also stop any legal proceeding that may come your way.
Protect your money – once you pay off your debts, you’ll stop all the automatic withdrawals that you authorized the lender to make.
Avoid additional fees and late payment penalties – lenders will charge a penalty fee for late and missed payments. Paying your loan in time helps you save some bucks towards servicing your new loan.
Reduced interest rates and a flexible repayment plan – instead of the double digits interest rates and APRs, you’ll get a loan that’s not affordable but also a flexible repayment schedule that’ll not hurt your credit.
Be debt free faster.
If the loan was secured, you might lose your asset if you fail to pay the loan.
Since the loan is long-term, you may end up spending a lot of money on interest.
You lose control of your credit and finances. While in the debt consolidation program, you’ll have to adhere to the consolidator’s advice on how to manage our finances, the loans to take and other income generating activities to be involved in.
To qualify for payday debt consolidation loans you have to:
Have more than two outstanding debts.
Show proof of income.
Have an active bank/checking account.
Have debts amounting to more than $1,000.
Your responsibility and rights as a borrower
Once you get out of payday loans debt trap, make a decision never to look back.
All the above effort and hard work will go to waste if you don’t change your spending and credit utilization habits.
Below are other means of living a debt free life.
Make sure you take out loans that you can afford and comfortably pay in time.
Reduce your credit utilization rate to below 30%.
When you get into financial distress, instead of taking out payday loans, look for other alternative sources of funds like borrowing from friends and family, taking out an advance at work or using credit cards.
Work on building your credit score to qualify for affordable loans with better repayment terms. An excellent credit rating will enable you to access loans at banks and credit unions.
Live within your means. Spending more than you earn is never a good idea. It’ll only make you incur more debts than you can pay.
Debts may be inevitable, but overreliance on debts is not good either.
Payday loans may look good on the surface, but they can easily ensnare you, and once you get trapped, getting out is an uphill task.
If you need loan help, this article will give you all the insight you need to get out of debts and live a debt-free life.
Making the conscious effort to get out of the payday loan cycle will not only help you gain control of your finances, but it will also help you live a life free from anxiety, and in your terms.
The truth is that once you start getting used to payday loans, it can be difficult for you to get out of it, especially when you have this tendency to rely on them when you run out of cash. Many people fall under this trap which makes it difficult for them to pay back. These kind of loan is quite costly since interest rates charged or quiet high. Now what happens is when you are already having a hard time paying back your loans, you fall in a debt trap.
What are the common problems people face with payday loans?
Payday loans are actually expensive.
One of the main reasons why people take out payday loan is because they want to bridge the gap of their current financial needs. In cases where you need to pay for something and don’t have enough cash on hand, the easiest way out is to get a payday loan. This is because this kind of loan is fast and quick to approve. If you have poor credit score, you don’t have to worry as to whether you’re going to be approved since payday loan lenders or not so strict when it comes to credit standing.
Payday loans are structured in a way that it makes it difficult to pay.
Payday loans may be quick to get. But if you are going to look at the different payday loans, you will notice one thing. This type of loan is structured in a way that it is not easy to pay back. When you get a payday loan,you will have to pay whenever you get your paycheck. The thing is that if you are already struggling to make both ends meets, it makes your current financial situation much more complicated.
Most people are tempted to get more payday loans, one after the other.
Chances are once you start getting a payday loan, you think it is okay to get one after the other. This will out you in a debt cycle. Simply because it is easy to get a payday loan does not mean that if you are having a hard time paying your payday loan, you will get another to pay back the other.
The good news is that there are still ways for you to solve the problem. One of which is to find a legitimate payday loan consolidation company.
How do you get out of debt with payday consolidation?
In a payday loan consolidation, a financial services company helps you negotiate your outstanding your payday loans. With a debt consolidation company, you get to manage your debts as they help you make an account where you can make monthly payments in order to settle your loans. They negotiate on your behalf so it is much easier for you to manage your outstanding loans. Basically, their aim is for you to lower your monthly payments so you will be able to payback your payday loan.
Things to Consider
When looking for a payday loan consolidation company, it is very essential that you take the time in gathering information about these companies. Not all of them are legitimate and in order for you to avoid being scammed and wasting time, here are the things that you have to look at when searching for a payday loan consolidation company.
Make sure that the company is licensed and registered.
Look at the profile of the company. The profile information along with the contact details and other pertinent information that clients want to know about the financial services that they offer should be there.
Read reviews online. It actually helps if you read the comments and feedback from people who have already tried their services.
The company should offer a personal financial consultation. This allows you to ask the questions that you need.
When a company asks you for an upfront payment, say no. Clearly, this is not a legitimate company.
Another thing is that there have been a lot of people who got scammed because the debt consolidation company promised them that they can totally eliminate debts.
If they don’t want to answer your questions if you have queries, it is a red flag.
Debt consolidation companies are there to help you negotiate and manage your debts in such a way that it is a whole easier for you to pay back your outstanding loans. They cannot eliminate all of your debts unless your file for bankruptcy. So whoever promises you that they can help you get out of your payday loans that easy is a scam.
Paying back your outstanding loans and getting out of the debt trap is never easy. You may have to come up with different strategies that require you to look for other sources of income. Getting a debt consolidation company can significantly help you in so many ways. Then again at the end of the day, you have to tackle the main cause of the problem. Manage your finances wisely and look for additional sources of income.
When you need money and do not have cash on hand, you can get a loan and one type of loan is payday loan. Also referred to as cash advance loan, it is an unsecured small loan with a short term. It does not matter whether the loan repayment is related to the borrower’s payday or not.
Who takes out a payday loan?
For people who need quick cash before their next paychecks; payday loan is the answer to take of care of those unexpected emergencies. Payday lenders rarely check your credit making payday loans very attractive to people with poor credit. In addition, the loan application process is fast and funds are often released quickly after online negotiation.
Who are payday lenders?
Financial firms provide short-term loans to borrowers to be paid back as soon as the client receives his/her next salary. This type of loan appears to carry low interest rates but when you calculated the amount annually, that is very high. Payday loan firms know that they are the only the credit option for people in need of cash although critics consider that these loans place many borrowers in a high-interest debt cycle.
Payday loan requirements
The basic requirements for a payday loan application are similar:
Meet the minimum age requirement in your state (18 years old in most states);
Possess an open active checking account;
Show proof of income; and
Have a valid phone number.
How do payday loans work?
For example, you need to borrow $300 for a hospital bill from a payday lender. But first, you have to fill out a post-dated personal check for $340 (plus $40 for finance fee), payable to the lender. When applying for a payday loan online, you have to enter your complete information. The lender then advances you $300 for a set period, usually 14 days. On the due date, the lender will encash the $340 post-dated check. However, you have to pay additional fees if at the end of the term your debt is not fully paid.
Who uses these types of loans?
Many Americans use payday loans every year according to Pew Charitable Trusts. The fact is that anyone who owns a checking account and has a steady income qualifies for a payday loan. It appears that borrowers who are without credit cards and savings accounts resort to this type of loan. Consequently, payday loans are attractive to people with no credit or credit problems.
The Pew reported that payday borrowers share common characteristics: they are mostly renters with no home of their own; low earning capacity of less than $40,000 a year; and have not finished a college degree. They are often separated or divorced individuals with children and African-American in ethnicity.
According to that same report, the average borrower takes out at least eight loans of $375 and spends $520 on interest alone by the time the initial loan is repaid.
What are its benefits?
Payday loans can be a good tool for the quick and easy borrowing of cash during an emergency if you don’t have other financial options. Payday loans are helpful for people who don’t have credit cards or savings available for an immediate and temporary financial need such as an emergency medical bill, sudden car repair or other one-time expenses. As much as the loans do not require a traditional credit check, they are used by people with financial problems.
Considerations before taking out a payday loan
Before you apply for payday loan, think it over carefully, especially if you have a poor financial capability of paying it back on time. If you’re short of cash this month, think whether you’ll have interest rates and fees to pay for next month. Consider whether getting a loan payable by installment is much better. If you plan for a payday loan, search a lender under the regulation of the Financial Conduct Authority (FCA). Before you go ahead with facilitating a loan, it is very important that you read those fine print carefully and determine if a payday loan will improve your financial situation. Keep in mind that if loan payments are not settled quickly, they become extremely expensive, so be careful.
Understand how payday loans work
Understand well how payday loans work. These loans are only a good alternative if you can guarantee to pay off a loan by the due date because the outcome would be very expensive requiring you to pay high interest rate. Payday loans are classified as short-term borrowing and must be repaid on a specific date, usually within one month or even less.
Payment with interest for a payday loan when not paid back on time. If you cannot afford to pay it back punctually, your best option is to roll over your payday loan. But again this comes with more interest and fees.
Upon taking out a payday loan, you give your lender authority to withdraw the money you owe plus interest from your bank account on the due date, either by a written post-dated check or by signing a certification allowing them to make deductions automatically from your checking account. If your fund is inadequate to pay for your account on the due date, you will add more payments to your lender and the bank.
Consider the effect on your credit score
When deciding whether to take out a payday loan to pay off other debts, think about how it will affect your credit score. If you are unable to settle payday loan, your account will be forwarded to collection that will be disastrous and very bad on your credit report. You can avoid dealing with collections by making monthly payments of your credit card debt.
Credit card debts have an effect on your credit score as well even if you do not default on your credit card payments but carrying a large balance may lower your credit score.
What happens if your payday loan is unpaid?
Like other loans, if you fail to remit monthly payment, it leads to payment of higher fees, stiff penalties, and even legal action. Automatic debit payments are used by most payday loans to take funds directly out of the bank including prepaid account so on top of everything overdraft fees end on top of you. If all of your funds are taken, you have no more cash to pay for your necessities like childcare, food, and utilities. And the worst development is the barrage of calls and threats coming from your debt collectors. These are all unpleasant scenarios; don’t let it happen for there are ways to settle the debt of payday loans.
How to settle payday loan debt
If you are not able to keep up your payday loan debt and cannot meet the monthly dues, you can negotiate for settlement with the lenders of payday loans. Get rid of your debts and settle your payday loan debt by negotiating with them to allow you to pay a smaller amount of the balance you owe. Find the best way to settle payday loan so you can escape from the payday loan trap and stop harassment of collecting agencies and payday loan lenders.
You have to coordinate with lenders of payday loans or collection agencies and you can try to settle your bills on your own. Make sure you know how much is your total debt by checking your personal finance and credit report to find out which bills are unpaid and whether the accounts are able to pass the period of Statute Of Limitations (SOL).
In case you don’t feel comfortable negotiating with lenders, you may take advantage of settlement services. You are enrolled by these services to a settlement program so you are required to stop paying your payday loan companies to save a certain amount every month. When you’ve accumulated enough cash for several months, the negotiator at the settlement company communicates with the lenders or whoever holds your accounts so that they agree to accept an amount less than what you owe. Search details on the workings of debt settlement and study the pros and cons before you enroll in it.
Study steps to take for payday loan debt settlement
Follow these steps before enrolling in a payday loan debt settlement program:
Calculate the payday loan amount
First of all calculate your total payday loan amount by gathering all the documents and then list the names of the lenders, the amount you owe to each lender, penalties, interest rates, late fees, etc. Check if you will be able to pay the loan amount on your own.
Go through your state payday loan laws
Be familiar and knowledgeable with your state payday loan laws; if not, then you should know about them now. Each state has its own payday loan laws; better check whether your lender is following those rules. A good knowledge of payday loan laws of USA is important before paying any money to your lender.
Check the license of your lender
Does your lender have a license to do business in your state? If not, then you have a reprieve since that is a violation and you are no longer required to pay the interest rates and fees. You only have to pay the principal amount.
Place a hard debit check on your account
If you are not able to pay your loan or your lender is withdrawing illegally from your checking account, you may put a hard debit check on your account. You can also ask the branch manager of your bank to close the account, but this is not a wise move.
Once your checking account is closed, your lender will surely file a lawsuit against you for violating the terms and conditions of the contract. This may cost you a lot of money for a large amount is needed to pay the attorney fees and other court-related fees.
Selecting a trustworthy settlement company
Check the fee structure of the company. Under the new settlement laws, every debt settlement company is required to charge fees in proportion to the settled debt amount. So, if this settling company is not following the rules, then doing business with them will put you at risk.
Check the certifications whether the debt negotiators of the settlement company are certified by IAPDA. When debt negotiators have sufficient knowledge on law settlement, they get their IAPDA certifications.
Watch out for the affiliations as good settlement firm will be affiliated with organizations like TASC, BBB, etc. You find out if the firm is a bonafide member of United States Chamber of Commerce.
Check the performance of the company to make sure you work with a settlement company that has a good success rate. Visit the company’s official website and gather as much information about the company. Read their testimonial sections if they have one and know their clients’ testimonials if they are satisfied with their services.
Find out whether the settlement company offers any service guarantee to their clients. If positive, then check the assistance they will provide if the settlement work is not sufficient to relieve the burden of your debt. Check if fees are refundable by the company if they are unsuccessful in settling your payday loan debts.
Consult your family – You can always go to your family members and ask their opinion about the settlement company you’re considering to work with. Meanwhile, you can request them to recommend a good settlement company found in your state.
Aside from the points mentioned, find out if the company had been following the newly-enacted settlement laws by the Federal Trade Commission. For example, under this new enactment, settlement companies cannot charge any fees before the settlement of at least a single account of the consumer. They are not also allowed to make false claims about their services. Work only with a settlement company that follows all the given rules and regulations.
You got rid of payday loans, what next?
After you settled payday loan debt, make sure there is no next time. To start cleaning up your credit, a smart thing to do is sign up for a free credit report. The best way to ensure not to fall into any mistakes is to make a regular credit check and constantly improving your credit score.
You can also sign up for credit repair or search for a debt consolidation loan to help you pay off all of your debt including personal loans. This is a big step you are taking by following the right direction towards financial security.
Knowing how to settle payday loans will get you out of payday loan debt as well as other loans, although it seems daunting, it’s worth all your efforts and hard work. Learn to take control of your finances, save money as much as possible and start a plan for a secured financial future — it is a difficult plan but financial security is a reward worth striving for!
There are several consolidation scams which are taking advantage of people who might not know what they are up to. It is bad enough that you may be in debt. It would be worse to sink further in debt and lose your money to such scams. So, what can you do to avoid consolidation scams? The following are some helpful tips which may be useful to you:
Do extensive research
When seeking options on how to get out of debts, you need to do thorough research on the firms that offer such services. The Better Business Bureau (BBB) can offer you information on the consolidation firms that you may be considering.
The information may include historical records of the company, complaints that have been made against it and how they were handled as well as violations the company may have committed. Such information goes a long way into ensuring that the firm you approach has a good standing and can be trusted.
Ensure that payday consolidation companies are licensed and registered
In most cases, consolidation scams operate without the required legal licenses and are not registered. Should you come across such consolidators, be wary of them and do not use their services. This is because should anything happen, there is no accountability or law that will be able to protect you and ensure that your rights are adhered to.
Be familiar with the terms of the lender
It has been found that most consolidation scams take advantage of borrowers by capitalizing on the fact that they may not have scrutinized the terms of the contract before signing it. Therefore, you should check for any terms which may imply that some actions resulting in severe consequences can be taken against you should you fail to honor a specific duty. To avoid getting ripped off, also familiarize yourself with the laws in your state.
Contact the company directly
A good consolidation company is one which you can have constant and open communication with. This gives you a sense of confidence as you can know the progress of your repayments and there is a point of contact should you need any assistance or clarification.
Avoid consolidation companies that do not offer a contact person who can have a face-to-face meeting with you or one that does not even have a website or a physical office that you may visit. Companies without a physical office, reliable contact personnel or telephone numbers are probably scams that will vanish with people’s money.
Avoid the payday loan consolidation company which tends to increase your debt
Should you find a consolidation company that is constantly asking for your money, be wary of it because this is probably a scam. Such requests are not usually made.
A legitimate consolidation company shares the same goal as you – to reduce the debt you owe. There is a cause for worry if you are not given the following information: by how much the company can reduce your debt, the fee they charge and the time frame which they expect you to settle your debts.
Payday loans consolidation is a real option that gives you the relief you need to get back on the path to your financial freedom. If you cannot manage to pay off the cash advance loans within the next 30 days, Payday loan consolidation is a real option to give you the relief you need and reverse the vicious payday loans cycle. The pay day assistance programs are about breaking the cash advance loan cycle and setting you on a path to your financial freedom. It will help stop the harassing phone calls from the payday loan debt collectors and help stop additional high interest and fees from accumulating. We want to help you achieve your financial freedom and get back on track with NO upfront FEES.
Payday loans debt consolidation lowers your payments
Payday loans consolidation pays off payday loans quicker
Waive late fees
Helps eliminate collection calls
BECOME DEBT FREE !
The program is designed with your affordability and results in mind. We are committed to finding the best solution for you. We want to give each and every consumer the peace of mind they deserve. Thousands of Americans are struggling every day with payday loan debt. You are not alone! The specialists have the expertise and knowledge to help stop the harassing phone calls and negotiate a fair settlement in order to give you the chance to regain your good name and rebuild your financial future.
If you have more than 2 payday loans you may be stuck in what is known as the “payday loan cycle”. You may be buried under debt and cannot pay off the loan with your current income. If this is the case, you have options . Payday loans consolidation is a great option which most people do not know about. Consolidation will provide one simple payment without having to obtain more debt.
If you can manage to pay off your payday loans without consolidation within the next month, then that should be your objective. However if you cannot see yourself getting out from under the payday loan obligations within the next 30 days, payday loans consolidation is a real option to give you the relief you need and reverse the vicious payday loan cycle. Payday consolidation is about breaking the payday debt cycle and setting you on a path to your financial freedom.
We want to help you achieve your financial freedom and get back on track to a more financially responsible future. The payday loan consolidation companies can help you get out from under the payday loans circle, help stop the harassing phone calls and consolidate your payday loans for good.
Payday Loans Consolidation:
Payday loans consolidation programs do not require the use of equity in your home, vehicle or other financial assets.
Once you complete the payday loans consolidation program, you’ll find that you can usually get reasonable credit at several different rates. These rates decrease and improve over time with a history of making proper on-time payments.
Payday loans consolidation programs have worked for many consumers already.
Payday loans consolidation programs are fast.
This outstanding program offers a manageable way out of your payday debt problems. So call us toll free or fill out our simple Free consultation form . We will get started in helping you free yourself from the burden of the revolving payday debt cycle using consolidation and get the financial freedom you deserve. Payday loans consolidation is the answer!
Payday loans usually offer quick access to money that you do not have. They have the benefit of being easily accessible and can be repaid on the borrower’s next payday. However, an individual risks falling further into debt should they fail to repay the loan because of the interest charges increases and there may be late payment fees as well. Debt consolidation is often suggested as a solution of getting out of debt. However, what happens when you consolidate? A better explanation of how debt consolidation programs function will help you understand if this is the best way to turn your situation around.
Escape the Debt Spiral
When you consolidate payday loan debt, you will no longer have to send a number of payments to your creditors. You will only be expected to send a single amount to the payday loan consolidation company. They will then send the money to your lenders on your behalf.
Advantages of Debt Consolidation
Payday loan debt consolidation also offers you favorable loan repayment terms. The debt consolidation company will negotiate for better repayment terms with your payday loan lenders for you. This will ensure that the amount you are expected to pay will be something you are able to fork out, given your cash inflow and expenses. This is a great relief for an individual who may have been previously struggling to make the high repayments expected by the lender(s).
The impact on your credit score after consolidating payday loans may be positive or negative. For a debtor who has previously been lagging behind on payments but successfully managed to clear the debt after joining a debt consolidation program, this will result in an improved credit score. On the other hand, if a debtor continues making late payments or defaulting, this will lead to a lower credit score. Therefore, undergoing debt counseling is recommended so as to find out which option is the best for you given your amount of debt and the situation you are in.
Also, you may look into the details of a debt consolidation program to know which is the one that will best suit you.
Factors to Consider
Such details include the interest rate, duration within which you are expected to clear the debt as well as the amount you should send to the debt consolidation company. Should you anticipate clearing your loan before the expected return date, you should also check if there is a fee charged for doing so. Failing to clear your loan within the period expected leads to more expenses in the form of interest and late repayment fee.
Escaping Debt for good
When you consolidate payday loan debt, the overall amount of debt is expected to decrease. This offers you a chance to pay off the debt with ease within the designated period. Ensure that you use the services of legitimate and credible payday loan consolidation companies. This is because there are various scams that may offer you attractive payday loan consolidation programs, but will end up driving you further in debt when they disappear with your money or impose harsh conditions in the contract which you may have not scrutinized closely before signing.