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Payday loan debt consolidation - Way out of payday hell !!

Have you taken out payday loans and now in search of a suitable solution to get rid of them? If yes, then you can consider payday loan debt consolidation.

How payday loan consolidation can help you out

  • Get rid of payday loan trap
  • Lower interest rates on your debt
  • Late fees and over limit charges reduced/waived off
  • Single monthly payment budgeting becomes easier
  • Do not have to manage individual creditors
  • Avoid harassing creditor/collection phone calls

Three steps to get payday loan debt help

1 Get Free counseling:

Call 800-DEBT-913 and get FREE advice on how and why to consolidate payday loan debt. Explain how much you owe on your payday loans and the interest rates lenders are charging.

2 Ask questions:

Shoot questions regarding payday loan consolidation services to the financial counselor. Ask how much you have to pay for the fees and when you can expect to get out of this debt problem.

3 Consolidate payday loans:

Once you get the answers to your questions, start arranging funds to consolidate payday loans fast. Make monthly payments and follow the payday loan consolidation plan properly.


How payday loan debt consolidation affects credit

When you opt for payday loan debt consolidation, there is a possibility of positive impact on your credit. This is because payday loan debt consolidation methods help you off your debts in full, and Paid in full statuses are updated in your credit reports. These affect your credit report and credit score positively.

Don’t panic if you have bad credit. Actually, when you default on your payments, be it a credit card or payday loans, your credit score will drop. Payday loan consolidation companies know this fact very well and provide extra help to borrowers to get out of this mess.


How to choose payday loan debt consolidation companies

  • Check out the accreditation of the payday loan debt consolidation company
  • Have a look at the breakdown of the fee structure
  • Find out if the past and current customers are satisfied
  • Check out the success rate of its payday loan consolidation programs
  • Browse the website and find out if the company offers online help and support
  • Have a look at the features of the payday loan debt consolidation program

How much
debt consolidation
can save you


How to know whether or not your payday loan is legal

Payday loan laws are not universal in every state. Here are certain payday loan laws based on which you can determine whether or not your payday loan is legal.

State legal status:

This determines whether or not payday loan is legal in your state

Loan specifications:

There are certain laws regarding the maximum amount, loan term, etc. which need to be followed

Interest rate cap on small loans:

In some states, there is a limit on the interest rate; lenders cannot charge more than that amount

Debt limits:

Even if a payday loan is legal in your state, there might be limitations on the number of loans you can take out at a time

Limits on collection:

You should know the collection fees amount and whether or not criminal action is prohibited

File your complaint and get information:

There is some regulatory board in every state where you can contact regarding any problem

How you can tackle illegal payday loans

You can follow these steps if you are sure that your payday loans are illegal.

Close your bank account
Ask your bank to close the account linked to your payday loan and open a new one. If the policy of the bank is not to close the account till a certain period, then opt for putting the account on deposit only status till the time you can close the account.
Notify lender that your payday loan is illegal
Notify your lender that either your payday loan is illegal in your state, or it does not follow the laws properly; for example you are paying more in interest.
Pay only the principal amount
If you have not yet paid back the principal, then inform your lender that you are willing to do so but on your terms and conditions. However, if you have paid more than the principal amount, then you can demand a refund of the overpayment.

How to consolidate legal payday loans

Payday loan consolidation program:

This program rescues you from the vicious cycle of payday loan debt. It offers you payday loan debt solution in a short span of time with lower interest rates and monthly payments.
Tip: It would be best to go for a payday loan debt consolidation program with no upfront fees since this is against the law.

Payday loan consolidation loans:

These are low-interest loans that help you pay off multiple high-interest payday loans and rest in peace. You need to make only one payment every month to pay off these loans gradually.
Tip: It is best to check out the interest rates and repayment terms on these loans so that you don't end up paying more.

Other ways to get payday loan debt relief

Debt management plan

This option gives you relief by reducing the interest rates on your payday loans.

Debt settlement program

This option gives you payday loan relief by paying less than the outstanding amount.

Bankruptcy

Here, the court offers payday loan help by liquidating assets.


CFPB trying to bring new rules to save borrowers

In March 2015, Consumer Financial Protection Bureau (CFPB) declared that it would like to implement new rules to save borrowers from the abusive tactics of the predatory lenders. The proposed rules would make it necessary for the payday loan lenders to determine if a potential borrower can pay off the loan in future - including principal amount, fees, interests, etc. The lenders have to check borrower’s income, borrowing history and financial liabilities before offering a loan. The rules would also impose a 60-day cooling off period between loans. Read more - CFPB Considers Proposal to End Payday Debt Traps

CFPB has not yet been successful in implementing these rules amidst oppositions from certain sections of the political parties. Richard Cordray, the head of the agency commented,

These common-sense protections are aimed at ensuring that consumers have access to credit that helps, not harms them.

So why are some political leaders are not backing these new rules? Well, Sean Barlett (the spokesman of Wasserman Schultz) replied,

The legislation is about preserving the shared goal of implementing strong consumer protections while also preserving access to affordable lending for low-income communities.