Payday Loans Debt Consolidation

Do Your Homework Before You Proceed With Payday Loan Debt Settlement Programs

If you are considering using payday loan debt settlement programs, there are several things that you must and must not do in order to get yourself prepared for the process. As part of the process, you are supposed to negotiate a deal with your creditors, trying to convince them to accept a lesser amount of money than the actual total outstanding balance in final settlement of the entire debt. Your success with these programs depends mainly on how prepared you are when you approach the creditors for such negotiations. It is always worth spending some quality time to do your homework before you go ahead with the process. The following tips will help you get prepared.

Is Your Lender Duly Licensed?

In order to prepare yourself for payday loan debt settlement programs, the first thing you have to do is to prepare a list that should include the details of the debts that you owe to different creditors, such as the amount of money you borrowed on individual loans, how much you have already paid, the names of the lenders, and the fees and rates you are being charged. It is important to note that every state has made it mandatory for the lenders to obtain a license in order to be able to offer payday lending programs. You can contact your state authority to get access to the list of licensed lenders. The idea is to find out if all your lenders are duly licensed. In case a lender is not licensed, the laws require you to just pay the principal amount without any interest or other fees.

Educate Yourself About The Laws Applicable In Your State Regarding Payday Lending

The more you know about the payday loan laws applicable in your state, the better you will be able to take advantage of payday loan debt settlement programs. Almost every state has some specific laws to regulate payday lending. have even made this type of lending illegal. If you are living in Georgia and applying for a payday loan online from a company that is based in Alabama, Georgia laws will be applicable. It means if you are living in any of those 16 states where such lending programs are banned, you will again be liable to pay just the principal amount without any interest or fees. Many states have made a provision for a that a lender must offer to a borrower if the borrower is otherwise not able to make the repayment on the set due date. Your awareness regarding these laws will give you an edge when you contact a lender to negotiate a settlement. When you find out that a particular lender is violating the laws, such as if they are overcharging you than the , you can against that lender with your state authority. However, before you file a complaint, you are recommended to try to get things settled through talks. If things still do not work, you can go ahead and get legal help.

Is Closing Your Checking Account A Good Idea?

In general, if you are considering using payday loan debt settlement programs, it does make sense to close your checking account as an attempt to force your lender to agree to a settlement deal. Though in specific circumstances where you find out that your lender is overcharging you or is sending the same check again and again for collection (resulting in multiple times check bouncing fee), it seems quite okay to close your checking account. But, if you have already decided to talk to your creditors, you should first talk to them and try to reach a deal. It is only when you do not reach a favorable settlement deal that you should consider alternatives like closing your checking account or getting help from your state authority. Remember, if whatever your lenders are doing are in line with the law, stopping payments on your loan, such as by closing your checking account, will be considered as a breach of the loan agreement and the lenders have the right to take you to court for this.

If you must stop automatic withdrawal from your checking account, the right way is to write a letter to them, requesting to revoke the ACH debit authorization. You also have the legal right to revoke any wage assignment agreement; when you do so, make sure you also send a copy to your payroll department. Overall, your awareness about the laws and your legal rights is the key when it comes to making the best use of payday loan debt settlement programs. Make sure you have done your homework thoroughly.


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Posted in Managing Payday Debt, Payday Loans Debt Consolidation | 3 Comments »

3 Responses to “Do Your Homework Before You Proceed With Payday Loan Debt Settlement Programs”

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  3. john says:

    Wonderful tips described and thanks for posting such a great article. Pay day loans takes the person into a big ocean of debt and once you found yourself in a ocean of debt you feel very irritating to get out from this debt but the process of exit is not so easy. There are so many debt settlement programs available in the market, but you have to select the best one for you. First of all you can go for the license check of your creditor. It is very important that your creditor should have a license. If he/ she do not have, you are liable to pay the principal amount only as mentioned in the article. Debt Settlement program will prove to be beneficial for you if you will be well aware of all the laws and rules. You can make a deal better for you with your negotiation skills. You have to talk to your creditors and explain your financial condition to them. You can discuss the repayment plan with them, either you will pay a lump sum amount or pay in the installments. Your negotiation skills will play a crucial role in the debt settlement.

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