Payday Loan Consolidation

You are having financial problems and do not know what to do? Had taken several payday loans and are having trouble repaying them? How do you get out of this financial woes? This article may be of help to you. Here you will find information about payday loan consolidation which is probably one of the best ways to get out of the payday debt cycle. We will walk you through every step of the payday consolidation procedure and make it easy for you to understand. It is important that you know you are not alone in your financial troubles and there are payday loan consolidation companies out there that can help in these difficult times.

When you should use payday loan consolidation

When you should use payday loan consolidation

When you should use payday loan consolidation:

You want your paycheck to be only for you

One downside of a payday loan is that your creditors can garnish your paycheck. That means every month, they will receive a part of your wage because you have not repaid them. The size of your debt grows incredibly fast once you fall behind on your payments. As a payday loan is a high-risk loan, it comes with high interest rates and penalties fees. That means those monthly cut from your paycheck can last very long time if you do not take any action to get rid of your debt.

You do not want to pay high payday loan interest rates

As you may already know, a high-risk loan payday loan has high interest rates. What you may not know is that if you take a payday consolidation loan, that will change. With a payday loan consolidation loan, you will be able to repay most if not all of your other debt. In the end, you will only have to pay one interest rate – the payday consolidation loan interest rate and it will usually be  lower than what you used to pay for multiple payday loans you had before.

You are sick of being stuck in the payday loan cycle

Have you ever tried to repay your payday loan with another payday loan? You are not the only one. In fact, it is kind of addictive because of the immediate relief a payday loan gives. The thing is, it is a temporary solution which in fact creates a much bigger problem. Sooner or later, you will realize that you now have multiple payday loans. At that point, it seems impossible to get out of this and you start to feel pretty desperate. However, payday loan consolidation may be able to help you.

You are finally ready to have your financial situation under control

You need to decide is that you will have to gain control over your financial situation and make your monthly repayments. Payday loan consolidation can make your life easier in the sense that you will only have to make a single payment every month and the amount and interest rate will be lower. However, you will still need to be able to keep up with it. There are various programs and you can consult with a professional to choose an option that matches your personal financial situation. Have the courage to start getting out of financial trouble today.

How payday loan consolidation works

How payday loan consolidation works?

How payday loan consolidation works?

To understand how payday loan consolidation works, we have divided it into several simple steps. Stay well-informed and motivated.

Get to know the process of payday loan consolidation and make sure you completely understand it.

You can find a lot of information online. If you still have problems with some of the details, you can try consulting a professional. However, you want to make sure that you are consulting a third party who will provide you with honest advice and realistic valuable information. You have to be critical of everything you read or hear. Your third option is to discuss the loan consolidation process with people who have already gone through it. They can provide you with good first-hand experience. However, you should have in mind that each person’s story is different – they would have different debts or have used a different payday loan consolidation companies. You will have to compare the differences and similarities and evaluate the situation accordingly.

Decide if loan consolidation is the right option for you

There are three payday loan relief options disposable to you – payday consolidation program, a consolidation loan, and a payday loan consolidation loan debt settlement. They function very similarly but there are some differences you might need to know when deciding how to proceed. Here is how you can compare them:

–    In relation to what each of them does. Without going into too much detail, a payday loan consolidation debt settlement reduces the number of your total debts, while  payday consolidation program reduces the interest amount of your debt. A payday consolidation loan simply transfers your current debts to one different lender. All three options transform your multiple debts into a single one.

Decide if loan consolidation is the right option for you

Decide if loan consolidation is the right option for you

–    There are different payoff periods for every option. They vary from as short as a year to as long as 30 years. You could say the shortest version is  payday loan consolidation debt settlement which normally takes between 18 months and four years. It is shortly followed by a debt consolidation program which has an approximate length of between two and five years. Although payday consolidation loan may seem as the longest version and therefore not so desirable, it is exactly the opposite.

It is true it can take somewhere between one and thirty years but it all depends on how much money you have and how much you are willing to pay. It is entirely up to you how long will it take. There is not anybody else telling you how you should do it. That is not the case with the payday loan consolidation loan debt settlement and the payday consolidation program where you have strict rules about how you are supposed to repay and you are obliged to follow them. Naturally, this can get harder and harder to do in time.

–    Another factor is how you are supposed to make the payments to your creditors. With payday consolidation program and payday consolidation loan, you have to make monthly payments. On the other hand, with payday consolidation loan debt settlement you have to make one lump sum payment. The thing is in order to collect that lump sum, you will have to open a special saving account a put money in it every month.

So there is not really that much difference in this section. The only benefit you are getting with all the three options is that monthly payment will be the only one in opposition to you having to make monthly payments to all of your creditors on all of your multiple debts with different interest rates. Therefore, you might actually save some money by choosing one of those options.

–   At that point, you might ask yourself what are the requirements they would want you to meet. As already stated with payday consolidation loan debt settlement you will have to save the amount you will need before the settlement. The payday consolidation program will require you to make monthly payments and payday consolidation loan works with a collateral (which funnily enough does not change its nature as an unsecured debt, which is a little detail you should have in mind)

–    The last but not least important thing is the result these three options have on your credit score. With payday consolidation loan debt settlement your credit score will drop initially, while with both payday consolidation program and payday consolidation loan it will continue to drop gradually.

Generally, whatever you chose will help you improve your credit score and keep it better because they are designed for you to keep up with your payments and get out of debt. Both those things look good on a credit score and you want to have a good credit score as it is very important for many areas of your life.

In conclusion, you want to use payday loan consolidation debt settlement when you are looking to settle your debts rather quickly for less money and pay them all at once or in other words to just get it over with. Payday consolidation program is the best choice for you when you are looking to make cheaper monthly payments with a lesser interest rate amounts. If so, that is your thing.

A payday consolidation loan is a very good solution when you get approved for one. It might be your thing if you are able to pledge a security as a collateral. Consider your options very carefully and take the first step towards a life with fewer debt troubles in it today.

Talk to your payday loan consolidation company and share with them your financial troubles

In any case, you need professional help so let them help you. It is important to not to give up throughout the process. It will all work out eventually.

Get the legitimacy of your payday loan verified

You want to make sure that everything is legal. So do not miss out this step.

Receive a repayment plan that takes your personal situation into account and is affordable to you

With a viable repayment plan, you should be able to repay whatever it is that they are offering you and it is up to you to negotiate it correctly.

Monthly payments that come with payday loan consolidation?

This varies from case to case. There are several factors influence  the amount you have to pay each month. Those include but are not limited to:

  1. The exact number of debts you have and amount
exact number of debts you have and amount

exact number of debts you have and amount

There are different ways in which you can use payday loan consolidation. For example, if you have ten debts but you have managed to stay on payment on top of four of them and you want to keep it like this, you can choose to consolidate the other six payday loans. That way instead of ten, you will have only five debts – four you are managing to deal with anyone and a new one with a lower interest rate and in some cases even a lower monthly payment.

You may also want to consider consolidating all your payday loan debts at once. Depending on how overwhelmed you feel with the situation, that just might be your option. Having simply one debt instead of ten with different creditors will definitely make you feel less stressed and can help you get out of debt sooner than you expect.

  1. Will your lenders be willing to reduce their interest rates

Now, that is a tricky one but there is really not much you can do about it. What you need to know is that before taking out your payday consolidation loan, you should talk to your creditors and try to negotiate with them. If your relations with them are extremely bad, you can consider finding a professional to do it for you.

It is important because if none of your creditors agrees, you are losing an important advantage of the payday consolidation – the reduction of the interest rate. However, even in that case, payday loan consolidation still has benefits to offer- you will have fewer creditors, subsequently fewer payments calls and you will have only one payment to make which is always much easier to do. Try to get the best out of the situation you find yourself in.

  1. How much you can afford to pay
Make sure you are well aware of your current financial situation

Make sure you are well aware of your current financial situation

Naturally, the goal is for you to get help. Therefore, a payday loan consolidation program is trying to make sure you do not sink further into financial problems. Make sure you are well aware of your current financial situation before you talk with them for ultimate results. Make a list of all our debts and late payments. After you have finished with that, make another list consisting of all your disposable sources of income. In addition, you will need a third list with all the expenses you simply cannot live without such as expenses on food, clothes and utilities. When you have prepared all of that, you can discuss at length with your payday loan consolidation company what would be appropriate for you and how they can help you.

Normally, they will take into account all the information you have given them so it is important you have all your data correct. Be careful with the details and if any point you find you have made a mistake, contact your payday loan consolidation company and let  them know before it is too late. It sounds like a lot of work,but if you do not want to have financial hardships in the future, you should do such lists on a regular basis. This way, you can have control of your budget and make get into the world of planned household budgeting. If you can do it, it will be very useful for you as it can keep you out of trouble.

How you can get out of payday loan debt

This is a tricky question and you should be aware that the answer depends on several factors. First of all,  which state you are living in is very important. That is so because regulations vary from state to state and a certain option available in one of them may not be available to you if you live in another state. Secondly, it matter how many loans you have and how much debt you are in.

Another thing you should bear in mind is that it is important whom you have borrowed money from because different creditors have a different attitude towards your repayment of their debt. Some may disagree with the conditions of the option you have chosen as most appropriate for yourself. Although payday loan consolidation will most probably work out for you just fine, you need to check the things stated above and see how they apply to your case.

What you need to know before you take out payday loans online

What you need to know

What you need to know

Getting a payday loan consolidation is certainly very tempting. However, before you rush into it, there are a couple of things you need to do. First and foremost, you want to make sure you have found the right company to do business with. How should you do that?

  1.    Check if the online debt consolidation has a physical address as well
  2.    Try to see what kinds of reviews the payday loan consolidation company has
  3.    Make sure the company you have chosen has a fee structure that can easily match your budget
  4.    Check what state and federal regulations there are in regard to online payday loans
How should you deal with your payday lenders

There are two really harsh steps your payday loan creditor can take towards you- first, they can garnish your wage and second, they can send you a court summon and sue you. If you have more than one debt it is possible at some point you have to deal with both those things at the same time. What should you do? There are some steps you can take

  1. When creditors deduct money from your account with an authorization

You can take a series of actions in this case. First, inform both your payday loan creditor and your bank of your disapproval. Second, revoke the authorization. Third, change the location of your money. In other words, transfer them to another bank account. Open a new one if necessary. After all of that talk to the person who has lent you money and try to clear out the situation. The best case scenario is if you use payday loan consolidation and pay off this debt completely. An alternative would be for you to beg him for a repayment plan to which he may not agree. So do the smart thing and get payday loan consolidation.

  1. If you have received a court summon

Unfortunately, at that point, there is not much you can do. The best piece of advice we can give you is – answer it! It is never a good idea to ignore court documents.

Normally, it will activate a much more complicated and longer procedure if you do not. In any case, things can get worse. You should know that if you do not show up in court, you creditor will get a default judgment. Meaning, he will win the case for no other reason than you failing to show up for the hearing. You do not want that to happen. Do not be afraid and just go there.

If it is possible try to talk with your creditor before things go to court. You might be able to reach a settlement with him in advance. That will save you both court expenses and is the sensible thing to do in this case. However, try to approach him carefully as it is a very delicate situation.

What loan consolidation traps you may fall into and how to avoid them

how to avoid loan consolidation traps

how to avoid loan consolidation traps

You need to know there are laws regulating payday loan consolidation and similar activities. There are special institutions that watch over what is happening and are trying to help you. Their job is to catch when there is a break in the system and fix it through an improvement in litigation.

In payday loan consolidation, Consumer Financial  Protection Bureau (CFPB) is the institution responsible for all that. There are two main ways they try to interfere in the process in order for you not to fall into some of the most common traps that usually come with payday loan consolidation through prevention of scams and through protection of you as a customer.

What you should know is that there are some new rules which the Bureau has proposed. There is  constant change in the area but sometimes it takes a long time to put the new regulations into action. Make sure you have sound the last active version of the relevant regulation you need. There is plenty of information on the Consumer Financial Protection Bureau (CFPB) webpage. Check it regularly and make sure you are on the safe side when dealing with your money and debts. Good luck!

 

Payday Loan Consolidation Benefits

If you have fallen into a payday loan debt trap, there are not many things you can do to get out of it. However, payday loan consolidation is an option. We have prepared a list of its advantages which may work for you. You may most probably like to consider using payday loan consolidation if you are eligible for a debt consolidation loan. It is probably what you need to take out if you have a lot of payday loans debt.

Payday Loan Consolidation Benefits:

1.   Reduces stress
Reduces stress

Reduces stress

It is a good solution to a long lasting problem. Payday consolidation loan is a known stress relief tool that has an almost immediate effect. You may not always notice it but constantly worrying about your upcoming payments makes you anxious. It may affect your personal relationships since being stressed affects the way you treat your loved ones. In addition, it can negatively undermine your performance at work. A workplace is normally a stressful enough environment. When you get the extra stress of having to deal with numerous debts, it is close to becoming unbearable. That is really unnecessary when you can easily get all this negativity removed from your life. You should consider taking out a debt consolidation loan and you will see the change in your day-to-day life.

2.   It is easy to achieve
It is easy to achieve

It is easy to achieve

Payday loan consolidation works in a simple way. All you need to do is take out a debt consolidation loan. It serves to pay off all your accounts with creditors or in other words, it is used to consolidate all your previous payday loans which you can’t repay. A debt consolidation loan can be used for other kinds of debt as well. Payday consolidation is still the thing you should do, even if you have a bad balance on one or more of your credit cards. That way you will repay the multiple debts and the only thing you have to manage is the debt consolidation loan. Although it is better not to owe anything, it is still a much better option to have just one debt than have several of them.

There is one major benefit of having a single debt. There is just one deadline, a single creditor and most importantly, a single monthly payment. You do not have to receive multiple calls from various creditors anymore and do not have to pay a different debt every day of the week.

Apart from worrying less and being tormented less by creditors, it actually becomes easier for you to repay this one payday consolidation loan. Why is that? It is because now you can focus on it. You can plan your budget as you know all debt payments ahead. On top of that, your monthly payments that are due may actually be much smaller since you may have a longer time to fully repay the debt consolidation loan.

3.   It is useful and strategic to lower your interest rates
It is useful & strategic to lower your interest rates

It is useful & strategic to lower your interest rates

It is one of the best things about payday consolidation loan – it can actually save you money. How does it work? Because you do not have multiple debts after you have taken a payday consolidation debt, there is only one interest rate now and that would be your payday consolidation debt interest rate.What you win by getting a payday debt consolidation loan is a more reasonable, lower interest amount. That not only save you money on your monthly payments but also throughout the whole duration of the loan. Besides saving from a lower interest rate, you also need to get strategic with your finances. It is very important to plan ahead. Being prepared with a solution is always a good idea.

4.   It stops calls from debt collectors
stops calls from debt collectors

stops calls from debt collectors

A debt collector is probably everybody’s nightmare. It is definitely the last thing you want in your life. If you did not manage to repay what you owe within 180 days from the original deadline,  you creditor will turn your account to a collection agency. That is when hell begins for you. You will be receiving multiple e-mails and letters and daily calls even at work and calls at night. A payday loan consolidation could be your solution to end all those harrassement. Take out a single loan to repay all those outstanding balances.

Tip: Check out what state regulations are imposed on debt collectors and make sure you know your own rights. Their actions are regulated by the Federal Trade Commission (FTC). There is a Fair Debt Collection Practice Act (FDCPA). It covers certain kinds of debt such as family debt, personal and even household debt. In some cases, creditors may be forbidden to call you between 10 p.m. and 8 a.m.

That will definitely help you get some much needed  sleep at night. Another thing is that debt collectors may even be forbidden to call you at work if they know that it causes problems at work and your boss opposes it. Make sure you do not give up too easily and do not make yourself an easy victim. The federal regulations apply to everyone, regardless whether it is a debt collection agency, a lawyer who provides such a service on a regular basis or the notorious companies out there that go and buy delinquent debt. Harassment (whether verbal or physical) and false statements are strictly forbidden.

5.   It improves your credit score
 It improves your credit score

It improves your credit score

We all know how important credit score is and how hard it is to maintain a good one. There are just so many things that can have a bad effect on it. Having unpaid debt is one of them. That is especially true when you make late payments. Having multiple debts makes the situation worse. You may wonder what payday loan consolidation has to do with it. Well, a lot. The more debts you have, the easier it is for you to fall behind on some payments. That goes immediately on your credit score (and stays there for about seven years).

Then your credit score gets worse and worse every month. There is a very simple fix to the problem – take out a payday consolidation loan, repay all your other debts and have them marked as paid. That improves your credit score. You also need to stay on top of your payday consolidation loan payments. Through taking a payday consolidation loan you can rebuild your credit score over time.

In a nutshell, a payday consolidation loan could help you in many ways. Not only will it help you reduce the stress levels in your life and improve your personal relations, it will also make it easier for you to stay on top of your single monthly payment. In addition to all of that, it will get you rid of debt collector’s calls and help you maintain a good credit score.If you are dealing with multiple debts and are finding it difficult to deal with the situation, payday loan consolidation may just be the answer to end your troubles.

Payday loan consolidation – PROs and CONs

Payday loan consolidation is a rather popular way for people to resolve the problems they have from payday loans. Payday loan consolidation is very useful and practical and comes with a lot of upsides. However, there are also some details you may consider as negative and want to be prepared or at least know more about them. Here is a list of the top ten things you need to know before taking up payday loan consolidation.

Pros of a payday loan consolidation

 

  1.    It comes without an advance fee
 It comes without an advance fee

It comes without an advance fee

An advance fee is a fee you pay before you have received any actual service. In payday consolidation loans and programs, you are supposed not to be asked to pay such a fee. And for payday consolidation loan debt settlement, it is prohibited for the company to receive a fee before it has settled any debt for the client. Even then, they can only receive a part of their fee for the amount of debt they have settled at that stage of the process.

That is a big advantage for you because it guarantees that the service you received is really worth the money you paid. There are many scam schemes where a loan consolidation company would request for an advance fee. After you pay, they disappear. Therefore, it is really good for you that you  pay only after the company has helped you settle some debts for you.

  1.    No more high interest rates

Payday loans have  one of the highest interest rates. That is because they are high risk loans.It is the same with credit card debt. However, there is a way out of this. When you use any type of payday loan consolidation, you will get a lower interest rate. Of course, there are various factors that will determine the exact interest rate.

Some of them include how many creditors you have, your outstanding debt amount, what actions have already been taken against you (for example, have you received a court summon or is your debt transferred to debt collectors, a garnishment on your wage or does your creditor take a certain amount of your paycheck with a permission) and how willing are those creditors willing  to negotiate.

Bear in mind the lower interest rate comes for the payday consolidation loan is because of its secured nature and its attachment to your asset. Payday loan consolidation is the only option to settle your debt that has this benefit.For example, payday consolidation loan debt settlement reduces the overall amount of your debt.

3.  There are no extra fees for being late on your repayments
 no extra fees for being late on your repayments

no extra fees for being late on your repayments

One of the biggest problems with payday loans is they not only come with high interest rates, they come with punishments as well. When you are late on your repayments, you get punished twice for it – once through the high interest rate and a second time through late payment penalty fee. That makes it extremely hard to repay a payday loan as its amount increases very fast to unbelievable amounts.

It seems impossible for you to ever repay it. That is exactly when you need to use payday consolidation. Payday consolidation loan, payday consolidation program and payday consolidation loan debt settlement come without any extra fees and without any extra financial penalties for late repayments. This is yet another reason to choose payday consolidation to get you out of the payday loan cycle.

4. Payday loan consolidation reduces the probability of you getting sued

You might wonder  how payday loan consolidation makes the chance of you getting sued smaller. Well, it is pretty simple. Once you have used payday consolidation relief, you would have repaid most if not all of your debts. You will not have multiple creditors and you will be out of the outstanding debts you have as well. Therefore, your previous creditor don’t have a reason to sue you anymore. Of course,  some of your creditors may have already started a court procedure and are unwilling to drop it.

In those cases, you can try to contact them and negotiate with them. Explain what repayment plan you have and see how they will respond. There is a pretty good chance they will agree to what you offer because court procedures are expensive (there are court fees and additional attorney fees that may vary) and there is the chance they may lose. Therefore, it is actually in their interest to receive whatever they can from you.

  1.    The calls from your creditors will reduce or stop altogether
calls from your creditors will reduce

calls from your creditors will reduce

The whole idea of payday consolidation is to reduce the number of debts you have. In fact, the goal is to reduce the number of creditors you have. People can be very difficult to deal with especially when there is money involved. Each creditor requires a different approach and offered different conditions on his debt. Therefore, it is extremely exhausting and overwhelming to try to deal with them. On top of that, there are several ways in which your creditors can come after you. Some may limit themselves to just calls and letter (and e-mails). Plus, they can get you in trouble with your boss if harassment happens during work hours.

In addition, another group of creditors may try to sue you or garnish your wage. All of those are not in your favor. Loan consolidation  can stop all these. Once you have repaid your multiple debts, all those annoying creators have no reason to bother you anymore. Even though some of them may continue to call, you now have the legal right to request them to stop. Finally, you will have some peaceful time without calls from creditors.

Bonus: Your payday loan consolidation company is doing (almost) everything instead of you.

When you sign up for a payday consolidation program or a payday consolidation loan debt settlement program, it is their job. Basically, the company will deal with your debt and your creditors while you just need to stay on top of the monthly payments you have negotiated with the company you have chosen to work with. Most importantly, those payments would take into account your actual financial ability.

Cons of a payday loan consolidation

1. You need to avoid payday loans in the future

It is way too easy to fall into payday loan cycle again. Be sensible and avoid payday loans as much as possible.

2. You need to follow your payday consolidation company’s advice
three payday consolidation options in front of you

three payday consolidation options in front of you

three payday consolidation options

There are in fact three payday consolidation options in front of you – payday consolidation loan, payday consolidation program and payday consolidation loan debt settlement.

Payday consolidation loan is like any other loan you would take and you just need to keep up with your monthly payments.
Then there is payday consolidation program. It offers a plan to help you manage  to pay off your multiple debts. You will have to follow the advice of your payday consolidation program company. It is not something you have to worry about  because they are professionals and have developed these programs to help you.

The third option for you is payday loan consolidation debt settlement. It is in fact like other debt settlement. All that is required of you is to find a decent payday loan consolidation company and try to stay away from scam schemes. Payday consolidation loan debt settlement companies offer a legitimate service. First, they will discuss your financial troubles with you. Then they will create a personalized plan for you. It will include the fee, amount they think you can afford to pay for your debt.

That amount must be equal to what they think they can negotiate with your creditors. That is because they need to convince them to settle your debt for less than the original amount. On the other hand, you have to do is almost close to nothing and you get a lot in return. The bad thing, however, is that you really need to listen what your payday consolidation loan debt settlement company advise you to do. Otherwise, you might compromise the process because your actions may affect future negotiations with your creditors.

They will advise you to stop all payments to your creditors which might temporary damage your credit report. Therefore, it may be tempting for you not to listen to them. However, you should bear in mind that you have chosen professional assistance that has proven efficient  for many other people and there is a reason for their advice.

3. The procedure might be lengthy   

Efficient financial solutions require patience. Payday loans normally provide a quick relief for when the deadlines are approaching and you don’t have enough money to pay your bills. However, faster the solution, the less its effect last. The length of the procedure will depend on which of the three options you will choose. In the best case scenario, it is no less than six months or a year.

A payday consolidation program and payday consolidation loan debt settlement normally take between 18 months and five years depending on various factors such as how many creditors you have and how willing are they to participate in the process and how much you can afford to pay monthly. With payday consolidation loan, you are looking at one to 20 years. The good thing though is that you will have a lower interest rate and a monthly payment specially chosen to match your personal budget.

4. You may not be able to stay on top of your payday loan consolidation monthly payments
multiple payday loans

multiple payday loans

Unfortunately, that is an unavoidable danger. If you have multiple payday loans, you have to make multiple monthly payments. If you go for a payday consolidation loan, you only have to make a single monthly payment. If you chose payday consolidation program, you still get to make a monthly payment. With payday consolidation loan debt settlement in order for you to collect the money to make the single repayment, you have to make monthly payments for a certain amount of time. You can see the trouble here – in all those cases, there is a chance for you to fall behind on those payments. You just have a choice between the bigger and the smaller evil.

You have to evaluate which is a better option for you personally. The benefit of payday consolidation program is that the payment is just one as opposed to multiple repayments. That means one creditor, one relatively lower interest rate, one payment. The same goes for payday consolidation loan. A payday consolidation loan debt settlement offers one additional benefit – it makes all or most of your debt to go away forever for less than its original cost.

5. In secured loans, you risk losing your collateral

A collateral is an asset that you offer to the lender to secure the loan. That means that if you stop making your repayments, the creditor can seize your asset to cover his losses. That only applies to payday consolidation loan where a collateral is required. Because of the collateral, your debt offers less risk for the creditor and that allows him to give you the desired lower interest rate.

Conclusion  

Payday loan consolidation is a rather safe mechanism that can help you a lot. Although it comes with few pitfalls, they are not very dangerous or damaging to your budget and credit score. In fact, most of the risks are manageable. There is help out there which you can seek out. So stay informed, be prepared and shape up your financial situation.