Payday Loans Debt Consolidation

How Allowing Your Lenders To Win The Case In A Small Claim Court Can Bring Payday Loan Debt Relief For You?

It may sound like a controversial suggestion, but this strategy really works and you are not doing anything illegal and if you do that. As per a recent study, a payday loan user often ends up borrowing an average of nine such loans as part of the viscous cycle of debt they get trapped into. If you are also in too much debt, something that you can afford to repay in full in one lump sum payment, you should try to get payday loan debt relief by requesting your lender or the debt collector (if your debts are in collections) to arrange an affordable repayment plan in small monthly installments. If that does not work out reasonably, you should just tell in plain words, “I’m sorry I don’t have money now; when I will have it, I will pay”. Every time they call you, tell them the same words again and again. Yes, this will irritate and annoy them, but you are doing anything illegal. If they use abusive language against you or try to threaten, just remind them that you are well aware of the Fair Debt Collection Practice Act and that you can file a complaint against them. If they threaten you that they will take you to court, repeat the same answer and let them file a lawsuit against you. Here, it is important to note that most payday lenders do not want to go for the “court way” to collect their payments, which means this strategy can actually force them to work out an affordable repayment plan for you. If they still do not agree for that and get ready to face the court. Following are a few key points that you must keep in mind.

You Cannot Be Sent To Jail For Non-Payment Of Debt

The first thing that is very important for you to keep in mind that the laws are in your side when it comes to getting payday loan debt relief. As per the state and federal laws, failing to make the repayment is not a criminal offense unless you are involved in fraudulent activities, such as providing wrong information to borrow loans. In normal cases, your lender can only file a civil lawsuit. Facing a civil lawsuit carries no risk of getting awarded with a jail punishment. In the most extreme cases, you may end up having a forced bankruptcy, but that situation is very unlikely, almost in the category of “rare”. In general, the court will create an affordable repayment plan based on your financial situation, which is exactly what you want. Other possibilities are that the court may require you to sell a specific asset that you own and that you do not need to meet your necessary living expenses to pay off the debts. This solution is also not that bad because considering the kind of serious debt situation you are in, debt repayment must be your first priority. Once your debts are paid off, you can buy those assets again.

No More Collection Calls

As soon as your debt collection case goes to court, you get instant payday loan debt relief, as an automatic stay is imposed, as per which all lenders are prohibited from making collection calls to you or to do anything to force you to make the repayment. Likewise, once a final judgment comes in, all such collection calls remain prohibited unless you again start making defaults or doing anything against the final judgment.

All Additional Payday Charges And Fees Will Stop

After a court order, all additional payday charges and fees are stopped. It means no more rollover of loans, no more additional interest charges, no penalties, no more check bouncing fees, and no nothing. Your current outstanding balance will be frozen. Depending upon your specific case, your regular monthly income, and other financial obligations, the court may even order lenders to waive off or reduce their charges.

It Will NOT Have Any Negative Impact On Your Credit Score

It is very important for you to understand that the payday lenders do not report or get access to the three major credit bureaus – Experian, Equifax, and TransUnion. Their access is limited to smaller credit agencies that are not very important. It means if you try to get payday loan debt relief using this strategy, you do not put your credit score at risk.

It is important to note that if your state has banned payday lending and if you still have been offered a payday loan by a lender (even if the lender belongs to any other state where payday lending is allowed), the court will simply ask you to pay off the principal amount only. The similar things apply if the lender is not licensed to offer such lending programs in your state. Therefore, your awareness about the laws is very important. The easiest way to use those laws in your favor is to allow your payday loan debt collection case to go into court and then just sit idle and wait for the judgment. But remember, this strategy to get payday loan debt relief is recommended only for those who are in a hopeless debt situation, where the outstanding amount is too big to pay off otherwise.

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Posted in Managing Payday Debt, Payday Loans Debt Consolidation | 2 Comments »

2 Responses to “How Allowing Your Lenders To Win The Case In A Small Claim Court Can Bring Payday Loan Debt Relief For You?”

  1. [...] This post was mentioned on Twitter by Rajesh Anand and Eli, Rajesh Anand. Rajesh Anand said: How Allowing Your Lenders To Win The Case In A Small Claim Court Can Bring Payday Loan Debt… [...]

  2. john says:

    Very informative. Payday loan seems to be very difficult to repay, the small principal mount turns into a huge amount with in a very short period of time. Any individual trapped in the cycle of multiple loans can think about the settlement of debt. If you are not able to pay the amount under settlement you can tell the collectors about the status of finances and your inability to repay the loan. Debt Collectors can give you repeated calls, you may also repeat your answer but if they use abusive language or do the harassment by other way, you can tell them that you know about the Fair Debt Collection Practice Act. You must be well aware of the laws. No body can send you to jail for not paying the loan. Creditors can file a civil lawsuit against you and in this case the court will provide you a repayment plan according to your financial position, the court can suggest you to sell asset of yours and repay the loan amount. If you follow these suggestions you can enjoy a debt free life. There will be no more check bouncing fees, no ore additional interest charges will be there.

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