Payday loans are considered attractive because they are typically convenient to obtain and provide quick access to cash, but they often come at a high price. Many consumers find themselves unable to pay their payday loan debt because of accumulating expenses or lost income and end up owing a lot more over time due to the high finance charges and fees attached to the original loan. If you are stuck in this situation, there is no time like the present to receive debt assistance and relief from what is sometimes referred to as the payday loan trap.
Exploring Your Relief Options
If you are ready to get debt relief from your payday loans, there are two viable options to get you back on financial track: debt consolidation and debt settlement. Simply put, debt consolidation will roll your unsecured debts into a new loan at a lower interest rate. Payday loan debt settlement or negotiation is when you and the lender agree on a reduced payoff amount to pay off the debt with one large payment. If you decide to choose one of these options, it is recommended that you work with a reputable payday loan consolidation company or debt settlement company to guide you through the process.
Payday Loan Consolidation
Debt assistance through payday loan consolidation is a popular option due to its predictability and flexible repayment terms. Debt solution companies will consolidate your debt into a single loan that is fixed and on a specified repayment schedule. The primary benefits of payday loan consolidation are:
- One easy monthly payment for your debts (fixed payment on a recurring schedule)
- You know when it will be paid off
- Lower interest rate
- Usually maintains your credit, as long as timely payments are made
Many individuals qualify for payday loan consolidation, and it can be a viable and wise solution if you have accumulated significant unsecured debt.
Payday Loan Debt Settlement
Another solution to payday loan debt is through debt settlement, which involves vigorous negotiation with your lenders to pay off your debt with a one-time payment in full. Although you can do the negotiation yourself, it is recommended that you work with a debt settlement company that will advocate on your behalf. With debt settlement you:
- Agree to pay the debt at the negotiated amount (which can often be up to 50% of the original debt)
- Pay off your debt years sooner than through other solutions
- Avoid monthly payments and recurring interest charges
- Can avoid bankruptcy
Although payday loan consolidation and debt settlement are popular solutions, there are other options to consider depending on your level of debt and individual financial situation:
Ask about an extended repayment period with your payday lender
Work with a credit-counseling service to seek alternatives for debt relief
Speak to a legal aid attorney to learn your legal rights and options
Taking Action to Consolidate Debts
When seeking debt assistance, it is important to calculate all of your debt and expenses, evaluate all of your options, research debt relief companies to make sure they are reputable and trustworthy, and find a solution that works for you. Getting out of debt can be scary and overwhelming, but you do not have to do it alone.
BSI is a BBB rated company with an A+ rating. We are a non-profit payday relief and loan consolidation company with national reach. We invite you to check for availability in your state then contact us for a free evaluation of your current payday loan debts and explanation of how you may benefit from our consolidation program.