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
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
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 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
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
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.