Payday Loans

What To Do If You Can't Pay Payday Loans In Time?

If you know that there won’t be enough fund in your bank account on the set due date and that you can’t pay payday loans in time, you are strongly recommended to contact your lenders in advance and inform them about the same. In simple cases, where the delay in repayment is just going to be for a few days, such as when you are expecting your salary to come a couple of days late, your lenders may agree to wait without charging you any penalty.

Things You Must Know About When Lenders Can And When They Can’t Call The Police

If you do not notify them in advance, it can put you into trouble. For example, you will be charged high penalty charges, bank charges for check bouncing will also apply, and at the same time, you will also be dealing with harassing collection calls. Some lenders are so strict and harsh with their collection policies that they can even call the police immediately charging you for writing a bad check, and then, they may try to take advantage of your vulnerable situation.

Here, it is very important for you to understand that they cannot call the police saying that you are not repaying your debt. Inability to repay a debt is not a criminal offence in the United States of America. But, writing a check that bounces because of insufficient fund in your account is treated as a crime and you can even be sent to jail for the same.

Things To Keep In Mind Before You Stop Check Payments

Considering the harsh legal consequences of check bouncing, a better strategy is to stop check payment in advance, especially when you know that you can’t pay payday loans in time. But, when you do this, you must send a written notification to your lenders in advance. If you are using the online banking facilities for your bank account, you can place the request to stop check payment at just a click of your mouse.

Things To Keep In Mind Before You Close Your Bank Account

Another strategy is to close your bank account, but there are a few very important things that you must keep in mind before you go for it. For example, the bank policies for closing a bank account may vary significantly from one bank to another. For example, if you are closing your bank account without stopping the check payments to lenders and without revoking their ACH withdrawal authorization, your account may automatically be re-opened whenever those checks are presented for payments or whenever any ACH withdrawal request comes in. Therefore, if you really want to close your bank account to avoid frequent hefty penalty charges, you must first block all the checks that you have issued to your payday lenders for payment. In case you have authorized your lenders for ACH debit withdrawal, you must revoke such authorizations first. But again, you must notify your lenders about the same in advance. Remember, you just have to notify them in writing; you do not have to get an approval from them on it.

Another thing that is very important for you to keep in mind here is that most banks allow you to stop check payments and revoke ACH withdrawal authorization without requiring you to close your bank account. So, if that works for you, you may not need to close your bank account at all. Instead, you can simply block your lenders’ access to the fund deposited in your bank account.

Last, but not the least, it is also important for you to keep in mind that closing a bank account is not a solution. Your lenders will still make collection calls and you may

still be sued for the payments in a civil court.

Things To Know About Lenders Filing A Lawsuit Against You

If you can’t pay payday loans, you may be sued by your lenders. Payday lenders have the legal right to file a civil lawsuit against you for non-repayment of debt in time. But, in general, if the outstanding balance amount is less than $1000, many states may not allow lenders to file small claims cases. In such a situation, lenders often wait until the outstanding balance reaches a bigger amount; once it does, they file a lawsuit. The problem here is that no matter how small amount of payday loan you have borrowed, it grows very fast because of extremely high interest rates.

However, if the lenders are illegal ones, they will never feel like fighting it in court.

Overall, if you can’t pay payday loans in time, you must keep in mind the above facts before you take a step.

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