If you have taken out a few payday loans and got caught up with the repayments and interest rates, there’s no need to panic just yet. You can still get yourself out of this financial rut by tapping payday loan debt consolidation programs. This solution allows those with multiple high interest loan debts to combine all of these into one loan to make it easier to monitor and pay.
Many of those who take out payday loans are people who have poor credit or have incomplete papers to qualify for a traditional loan, so they turn to these financial solutions to fund different needs. Considering how easy it is to get approved for a payday loan online, it’s tempting to take out several at the same time. As long as you can pay it back, it should be no problem. However, there are some times when they can get overwhelming and consolidating them is the smartest solution.
Advantages of Payday Loan Consolidation
Reassigning your loans and placing them under one umbrella will make it easier for you to manage your debts. It enables you to meet just one affordable monthly repayment schedule, instead of constantly monitoring several ones at often higher interest rates.
Payday loan lenders also offer different fees for their services, so having just one loan to worry about and just one fee to compute makes everything convenient. As a result, you have simplified your finances, thus making it easier for you to meet your payment schedules and to plan in advance. Consolidation companies also take care of paying off your other previous loans after you’ve paid them.
What you need to know about payday loan consolidation programs is there are companies that hold your money for as long as three months before they pay off your previous debts. This is bad practice and you should read the fine print or ask about this outright before committing to anything. No matter what the explanation is, this process places you at a much higher risk and possibly more problems with your creditors.
Payday Loan Consolidation Fees
Loan consolidation companies’ fees vary depending on your payday loan debt situation and are typically computed on a case-per-case basis. While you’re shopping around for a loan provider, you can ask for a free quotation from several agencies so you can compare rates and their payment practices. As per usual practice, payday loan consolidation firms make payments to your lenders after you have made your first payment. This goes on until your previous debts are finally cleared.