If you're unable to meet payments on your payday loans, you may consolidate them and replace multiple bills with a single payment each month. This will help pay off debts faster without having to write several checks a month. If you want to know how to consolidate and pay off outstanding payday loans, then check out the topics below:
- How do you consolidate payday loans?
- Should you consolidate payday loans sent to collections?
- How do you benefit if you consolidate payday loans?
- Are loans available for consolidation?
- When should you go for Extended Payment Plan?
How do you consolidate payday loans?
Debt consolidation is applicable mostly to internet payday loans (pdls). Here's a step-by-step approach on how to consolidate payday loans held by your creditors.
- Calculate debt amount: Find out the outstanding balance on your payday loans and other unsecured debts (if any) using the Unsecured Loan Calculator.
- Contact consolidation company: Approach a debt consolidation company which can help you consolidate payday loans. The company will offer you a free debt counseling session where you can talk to a debt counselor about your financial problems.
The debt counselor will analyze your current financial situation and suggest whether you should go for debt consolidation program or debt settlement. - Negotiate to reduce rates: The debt consolidation company will negotiate with your creditors in order to obtain lower interest rates on your payday loans. This is to make sure that you can pay off the principal loan along with reduced interest costs. Moreover, there are chances that your late payment fees can be cut down or eliminated.
- New payment plan: The debt consolidation company will negotiate an alternative repayment plan with your payday lenders. Prior to negotiating on your behalf, the company will help you determine the maximum monthly payment you can afford on your payday loans. The purpose is to work out a suitable plan so that you can continue making payments and get out of debt in a short time.
Should you consolidate payday loans sent to collections?
If your internet payday loans are sent for collections and the collection agency (CA) calls you for repayment, here's what you should do:
- Verify the SOL: Check out the Statute of Limitations on the debt.
- Request for debt validation: If the SOL hasn't expired, chances are that the CA may win a judgment against you and garnish your wages. So, ask the collection agency to validate your debt. Send them a debt validation letter.
- Consolidate and pay off debt: Once the debt is validated, try to consolidate the payday loans in order to get out of debt faster. Repeat steps 1 to 4 as given above. Here the negotiation should be done with the collection agency and not the original creditor as because he doesn't hold the debt any longer.
Once the SOL expires, the collection agency cannot win a judgment against you even if you do not pay off the outstanding debt. But this doesn't mean you don't owe the debt. The collection agency may try out means to collect it from you. You may send them a cease and desist letter asking them to stop any communication with you. Or else, you may pay off (consolidate payday loans or settle the debt) the unpaid debt and release your obligation. However, the SOL is restarted once you start making payments.
How do you benefit if you consolidate payday loans?
When you consolidate payday loans, you get benefits as in a debt consolidation program. Lower interest payments, reduced late fees and fewer payments instead of multiple bills are some of the advantages. For more details, check out the 8 benefits of debt consolidation.
Are loans available for consolidation?
There are lenders who offer debt consolidation loan to help you consolidate payday loans. But whether or not you can use it depends upon the payday loan balance you owe. Say if your debt amount is around $2500, you won't get a consolidation loan. Such loans are applicable to higher amount of outstanding debt.
When should you go for Extended Payment Plan?
If you've been dealing with storefront payday loans, there's the option to get an installment repayment plan or Extended Payment Plan (EPP) from the lender as per payday loan laws.
However, the repayment plan applies only to 8 states such as Alaska, Alabama, Florida, Illinois, Michigan, Nevada, Oklahoma and Washington. The plan is offered by lenders when an account reaches the maximum number of rollovers allowed by the law and the debtor declares that he's unable to continue with the payments.
In states, where the EPP does not apply to storefront payday advances, you can either consolidate payday loans or follow the steps to do it yourself debt management depending upon which is easier for you.
Debt Samaritan
Posts: 2018
Credits: 42635.45 Send message to ben
I consolidated my payday loans with this company and I was referred to a consultant who did the negotiation with my creditors. Hopefully, I will be able to solve my debt related problems within the next few months.
You can also enter for a free counseling in this website and know your available options for debt repayment.
Posts: 2
Credits: 8538.15 Send message to m_hicks_2003
Thanks for that information. I am going to call the company as soon as I am out of work to consolidate payday loans. I mean I needed them at first and I have just been consistently paying nothing but interest. I took on a second job to be able to pay them off and it just doens't seem to be getting anywhere. If you don't mind me asking how much did you owe and what were your payments like? I would just like to get a really quick ballpark. I have too many because I thought it would solve problems a while back, but I DID learn a lesson. I use to have 8 and now I am down to 6, but it still adds up. I know once I have them under control I can save up and not worry abouthaving to need cash again. Thanks for your response.
Debt Samaritan
Posts: 2018
Credits: 42635.45 Send message to ben
The consultant will call you up at the phone number you entered during your registration in this website for a free counseling and give a plan to consolidate payday loans. In my plan, I opted to clear the debt as fast as possible and also I have some available cash in my hand. So I opted to pay $200.
Yes, payday loans are not less than a drug and their aftermaths are brutal.
Debt Samaritan
Posts: 404
Credits: 24791.25 Send message to Rhonda28
I am in the same situation as you. I am interested to consolidate my payday loans as well. I did the same thing thinking that I could get ahead with taking out payday loans and now I am just trapped. I was paying about a 1000 a month in fees alone. I would like to get out of this whole and get ahead!!! thanks for the information.
Debt Samaritan
Posts: 2018
Credits: 42635.45 Send message to ben
I realized during this time that a proper negotiation is the thing that is most required to consolidate payday loans for getting rid of this problem. Thanks heaven, my consultant showed keen interest in negotiating with my creditors and I am able to feel the result of it.
Hopefully, I will be able to see the results of this hard work in my credit report very soon.
Posts: 2
Credits: 8538.15 Send message to m_hicks_2003
I have recently looked at my cerdit report, I monitor it monthly, and I do not have any payday loans on my credit report. Does it effect it negatively or positively at all with consolidation? None are on my report. Only my credit cards, student loan and car loan on that report, which is good. Will it stay that way?
Posts: 3957
Credits: 55974.5 Send message to roxette
If there is a debt that does not belong to you and stays in your credit report thus, giving negative information, then it will hurt your credit ratings.
However, if a debt has not been reported by your creditors and they are making collection efforts, then you need to negotiate with them in order to settle it off. If the creditors fail to recover the debt from the consumers, they report to the bureaus and this will affect your credit ratings.
An important tips to consolidate payday loans:
Please make sure that you do all the needful negotiations with your creditors before it is reported to the credit bureaus.
Regards
Roxette
Posts: 1
Credits: 57 Send message to aundreakendle
I wanted to consolidate payday loans and even went so far to set up an appointment with a local agency. I held off and tried to apply for a mortage loan. I asked the lender would my credit be effected if I did so? They advised me it was worst then filing bankruptcy. I want a new home and I'm trying to clean my credit up, but at the same time I want to pay these loan sharks off. Especially Ellis Crosby and Associates (who are threating to lock me up tommorrow morning at 9am. after they embarass me by speaking to my supervisor). I also would like to know if this maybe grounds for a harassment suit?
I would like some help on what to do about my payday loans. I thought these loans would help me, they are my biggest mistake. Allen Lewis called and said he was from a federal agency and would go to the place of employment and spot me. When I asked him which federal agency, he became angry. Said I commited fraud. Now it is on my credit report as trying to commit credit fraud. Would payday loan consolidation help? How do you start? where do I call?
Please report them to your state attorney general if they threaten you! You did not comit fraud and they are just another collection agency.
You can start here! Talk to Roxette she can help you
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