Payday Loans Debt Consolidation

6 Questions You Must Answer Before You Consider Consolidating Payday Loans

If you are considering consolidating payday loans, there are several factors that you must take into your careful consideration. It is very important for you to keep in mind that almost every state has enacted certain set of specific laws to regulate the high-rate payday lending. In Georgia, this type of lending program is even completely banned. If you are having multiple payday cash advances outstanding in your name, the chances are that some of your lenders are involved in unscrupulous activities and they have just tricked you into a serious debt trap quite illegally. Therefore, before you contact a consolidation company to get rid of your debt problems, you are recommended to get help from law first. Look into the specific laws applicable in your state regarding the various aspects of payday lending in order to find out if you have become a victim of fraud or scam. The answers to the following questions will show you the way on how to go about it.

Are Your Lenders Internet-Based Or Storefront?

Consolidating payday loans can be a little difficult if your lenders are internet-based, not storefronts. If it is an online company, and they have not disclosed their physical address, you should first contact the company to provide you the address. If they do not send you the details, you can . It is very important to note that even if you have borrowed from an online lender, the laws in your state (where the borrower is located at) will be applicable. Your state authority must be able to tell you if a particular online payday lending company is licensed to offer such loan programs in your state or not. However, in reality, it is often difficult to take actions against online lenders as compared to storefronts.

Which Companies Did You Borrow The Loans From?

Before consolidating payday loans, you must first prepare a list of all those companies you have borrowed the loans from. Once you have that list, you must do a thorough background check, such as by checking their records at the Better Business Bureau. In many states, check cashers are not allowed to offer payday loans. You can also contact your state authority (Here are the ) to find out if the company you have signed up with is duly licensed to offer such loans in your state or not. If they are not licensed, you do not have to make the repayment at all. Instead, you can use your legal rights and take actions against them. You can start by .

How Much Did You Borrow From Each Lender And When?

Other important factors that you have to work on may include the total number of loans you have borrowed, when you borrowed them, and how much is the principal amount on each loan. You need this information not for consolidating payday loans, but to do a thorough review and analysis of the applicable in your state and find out if everything is in line with the law. There are specific legal provisions in almost every state that restrict the maximum number of loans you can borrow at a time. Many states prohibit lenders from offering loans to those borrowers who already have an outstanding loan due in his/her name. Besides that, there is also a maximum cap on the total amount of money you can borrow as part of short-term cash advances. If a lender has offered you more than the maximum limit allowed in your state, they cannot force you for the repayment.

How Much Rates And Fees These Companies Are Charging You?

There are , where either payday lending is not legal or the lenders are a least strictly prohibited from charging extremely high interest rates or other fees. In , though these lending programs are legal, there are still several restrictions on the maximum interest rates and fees that lenders can charge. You are strongly recommended to check out the laws applicable in your state. The idea is to find out if your creditors are charging you more than the maximum limit allowed in your state. If yes, you do not have think about consolidating payday loans; instead, all you have to do is just to .

Have You Requested Your Lender For An Affordable Repayment Plan And Has Been Denied?

Many states have even made it legally mandatory for the lender to offer an affordable repayment plan for the borrower if he/she is unable to make the repayment within the set due date. Besides that, there are also restrictions on the maximum amount of collection fee that a lender can charge when a payday loan account goes into collections. Here is a that have specific provisions regarding collection fees and repayment plan.

How Many Times Your Loans Have Been Renewed Or Rolled Over?

Last, but not the least, many states have also restricted the number of times a payday loan can be rolled-over or renewed because of nonpayment. Here is a along with the details of the rollover laws applicable there.

If you are caught in a viscous cycle of payday loan debt and are paying a hefty amount of money in terms of charges and fees every month, the chances are that there is something seriously wrong going on. Therefore, it is crucial to do a thorough research and find out if the lenders are taking advantage of your unawareness and ignorance. Before considering consolidating payday loans, you must consider educating yourself about the laws applicable in your state. Once you find out that a lender is doing something illegal, you must take immediate action against them by filing a complaint wither with your state authority or with the FTC. When you are armed with awareness and knowledge about your legal rights, you can easily protect yourself against this predatory form of lending.


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Posted in Consolidating Payday Loans, Payday Loans Debt Consolidation | 1 Comment »

One Response to “6 Questions You Must Answer Before You Consider Consolidating Payday Loans”

  1. Richard says:

    Very Brilliant and amazing questions. The article is an eye opener for me. Its really very helpful for an individual trapped in the debts of multiple payday loan. Before deciding to go for a consolidation plan, every one must answer the questions given in the article. There is a possibility that you do not have to pay the loan if your creditors are surplus or fraud and they do not follow the laws of your state. There are several laws regarding loan in every state. You have to do a thorough study of the laws of your state. If you are well aware of these laws, no body can cheat you. As mentioned in the article, you should always try to take loan from storefront lenders, as it is comparatively easy to know more about them and one can verify by their physical address also. If your creditor is involved in any illegal activities and the loan provided to you is not given accordingly to laws, you can take legal action against the lenders and they can not force you for the repayment. Even the number of renewal or rolled over the loan can affect the situation.

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