Payday loans are intended for people who want cash immediately with no line of credit. But payday loans have triple-digit annual percentage rate (APR) interest charges and short payback time frames, so bailing out of one can be tough. When payday loan clients cannot repay their loans, they’ll frequently set up a new payday loan to cover the old one.
This practice is known as rolling over the debt, which incurs additional fees and raises the price of the borrowed amount. Payday loan debt grows increasingly expensive and becomes more difficult to pay back as it’s kept for longer periods of time.
Customers who incur such high-interest payday loans can try to consolidate the loans with another type of loan – that means paying back the existing loans with a single new loan that hopefully has better terms.
Such loans can be difficult to obtain, however, and if you are an individual resorting to payday loans in the 1st place, you may not have sufficient credit to get a consolidation loan to cover such loans, but it is always a good first step in the process of attempting to become debt-free, in particular from predatory payday loans.
Consult your bank and local credit union to determine if they have loan programs that are suitable for your particular financial situation. Getting a debt consolidation loan from your bank or local credit union will certainly save you money in comparison to being trapped in the payday loan cycle.
Consult with one of our experts to learn more about your options.
If you are unable to obtain a debt consolidation loan from your bank or local credit union in order to eliminate your payday loans, you have an ally with debt management companies such as Real PDL Help. Payday loan consolidation companies can help extricate you from exorbitant payday loans with spiraling high interest and an ever-increasing balance that you can’t seem to ever pay off.
In the end, it’s your choice how to manage your finances, and it’s critical to know all of the options you have at your disposal. When you enroll in a this program, you can kick creditors out of your bank account in no time and get into a debt management program that requires a single, affordable monthly payment for all of your payday loans.
That makes management of your debt far easier, as well as much less expensive because, with this loan, skyrocketing fees and interest are eliminated, and a payment plan is negotiated by debt management experts who are on your side and pay close attention to your financial particulars and negotiate with the creditors on your behalf to land the best terms.
Remember the below important disadvantages to payday loans the next time you consider resorting to one:
Short-period payday loans typically need to be repaid in a maximum of two weeks. Private and payday substitute loans, on the other hand, offer clients months or years to return the loan balance in regular installments. A repayment schedule spaced out over a longer period of time is always favorable to a debtor and typically leads to higher rates of successful repayment (also good for the creditor).
Payday loans carry exorbitant annual fees. Alternative payday loans and consolidation loans from your bank or local credit union frequently carry far lower fees. Know your options!
If the borrower doesn’t pay off the payday loan, the creditor can file a lawsuit against the borrower, resulting in wage garnishment.
Consolidating payday loans with a debt consolidation loan at a reduced APR is a great idea if you can get one. Getting cheap rates is more difficult than it appears, however. Consumers normally need a fair credit score to be qualified. Exceptional credit is required for an interest rate on the lower end of the scale.
Until a person can secure much better terms on a new loan, he or she should avoid taking on an additional mortgage to pay off outstanding debt.
As experts in best payday loan consolidation, we help consumers consolidate multiple payday loan debt payments into a single, affordable monthly payment. That’s debt relief you can count on. We negotiate with your creditors and provide credit counseling to help get you back on track. No more harassing phone calls, skyrocketing fees, and a vicious loan balance that just never goes away. Our program has many advantages, particularly if one can’t get a consolidation loan on better terms than those of the existing payday loans.