Payday Loans Debt Consolidation

How To Use An Extended Repayment To Stop The Payday Loan Debt Cycle?

Negotiating an extended repayment plan can be a great way to get rid of payday debts, but you have to be very careful while you go for it. In order to stop the payday loan debt cycle, you will have to negotiate an extended payment plan in such a way that should allow you to pay off the debts in easy monthly instalments over a certain number of months, but without requiring you to pay additional penalties for the extended period of time. For this, you will have to be very good with your negotiation skills. Payday lenders love to charge more to their debtors, and therefore, it is a very tough task to convince them why they should accept your proposal where you are requesting them not to charge additional interest or penalty charges for the extended period of time that you need to arrange the fund required to pay off the entire payday debt.

Lenders Do Not Want You To Go Bankrupt

It is true that payday loan companies make most of their profit by charging extremely high

amount of additional interest and penalty charges to those borrowers who fail to repay the loan on its scheduled due date. But, at the same time, it is also very important for you to keep in mind that payday lenders, or for that matter, any other lenders usually have to bear a huge amount of loss when the debtor gets bankrupt. Therefore, if you tell them that your financial position is out of order and that there is no better alternative than bankruptcy, they are very much likely to pay attention to your proposal for the extended repayment plan for payday loan without additional interest charges. Just make sure that you do not have to warn them or use a tone of language that they don’t like to hear from borrowers. Be very humble in your approach. If your situation is a genuine one and you are seriously considering filing bankruptcy to get rid of your payday debt problems, your lenders will probably suggest you a more affordable alternate repayment plan. So, talk to them.

EPP (Extended Payment Plan) Is Sometimes Mandatory

It is also important for you to keep in mind that EPP (extended payment plan) is sometimes mandatory for payday lenders either because of certain payday loan laws in your state or because those lenders are members of certain organizations. Many states have made it legally mandatory for payday loan companies to allow their borrowers to pay off the debts in easy monthly instalments without burdening them with extra interest or other financial charges. Likewise, all those payday loan companies who are members of the CFSA (Community Financial Services Association) are also obligated to offer an extended payment plan to those borrowers who are otherwise having difficulty in paying off their payday debts as per the current repayment plan.

Overall, you must first review your situation thoroughly; check the payday loan laws applicable in your state, and also, find out if your lenders are otherwise obligated to offer extended payment plan for payday loan borrowers.

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