Posts Tagged ‘best pay day debt consolidation loan’

Which Types Of Debt Consolidation Loans Are The Best To Pay Off Payday Loans?

When it comes to borrowing debt consolidation loans to pay off payday loans, there can be plenty of options for you. But, first of all, you must decide whether you want to consolidate your payday debts on your own or you are looking for a professional debt help service. Both options have their own merit.

Debt Consolidation Loans Offered By Payday Lenders Themselves

Payday lenders are coming up with new strategies to recover their money from those borrowers who have accumulated a whopping sum of money and have no idea on how to pay it back. As per the latest trend, many payday loan companies are now offering debt consolidation plans to their own borrowers. It means if you owe multiple payday loans from different lenders, you might be provided an option to transfer all the debts to a single payday lender. But, before you go for this option, there are a couple of things that is very important for you to keep in mind. For example, many states have legally prohibited payday lenders from offering any such plan. Yes, some states have made it mandatory for them to offer affordable repayment plan to those borrowers who are heavily in debt with payday loans, but that is a completely different thing. In general, this is particularly applicable in those states where automatic rollovers of payday cash debts are not allowed.

The states where payday lenders are not allowed to consolidate payday debts of their own borrowers include Arkansas, Hawaii, Indiana, Iowa, Kentucky, Montana, Nebraska, New Hampshire, Tennessee and Wyoming. You are strongly recommended to check the payday loan laws of your state before you accept any consolidation plan from your lenders. Besides that, it is also very important for you to keep in mind that such plans are not legally mandatory for you to accept. You can and you must always look for better alternatives.

Personal Loans, Home Equity Loans And Credit Card Cash Advances

If you do not want to get professional debt help, you can work on these three options. The best thing about all these

conventional loans is that even the worst deals on these loans will allow you to borrow money at a significantly much lower interest rate as compared to the rates that payday lenders charge.

You can use these conventional loans as debt consolidation loans in several ways. For example, you can either get a single big loan using one of the three options or you can borrow a certain amount of money using more than one option. Since you are already struggling with debt payments, the chances are that your credit score is not at par, which can be a big hurdle in qualifying for a big loan amount using a single conventional loan option. In such cases, the best strategy is to obtain multiple loans. But, you must have your priorities. Home equity loans require collateral, but they are the cheapest ones, as they charge the lowest possible rate. Personal loans come next. Credit card cash advances are the most expensive ones among these three loans.

Before you make any final decision regarding these loans, you must take the following crucial factors into account.

•- Whether you are comfortable with the idea of putting an asset as collateral or you want an unsecured debt consolidation loan.

•- You will also have to compare the rates and terms and decide whether the final monthly installments that you will be required to pay are something affordable for you.

•- Another important thing is to do a thorough calculation in advance whether the total amount of money that you are going to borrow using these options is sufficient enough to eliminate all of your payday debts.

Getting Help From A Reputable Debt Consolidation Company

As per the third option, you can consider getting professional debt help services from a reputable payday loan debt consolidation company. This option is the most suitable for those who are struggling with overwhelming amount of debts, such as where the outstanding balances are in thousands of dollars. But, that again is not a mandatory requirement. Even if you want to get help for less than $1000 of payday debt, you can still contact such companies and review the solutions they suggest. The best thing about this option is that it can reduce your debt burden almost instantly, as the debt consolidators you work with negotiate with your lenders and often succeed in convincing them to eliminate a large portion of your total debt, especially the ones that you have accumulated just because of extremely high amount of interest and other charges. Always remember, no lender will ever write off even a single penny from the actual principal amount. Whatever amount they write off is from that part of debt that consists of interests and different types of fee. The biggest drawback with payday loans is that even a few hundred dollars of loan can turn into a whopping sum of debt within a few months, which only keeps on increasing until you repay them in full.

Overall, when it comes to choosing the best debt consolidation loans to pay off payday loans, you must review the various options available with a calm head. Even if you are going through a very stressful financial situation, do not think about bankruptcy right away. Do your calculations and make an informed decision about which option makes the best suitable choice for you.


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