How to Escape the Trap Of the Payday Loan Debt?

Payday loans may seem easier at first, but if you fail to repay, things may take an ugly turn. If you are also stuck in the trap of payday loans, read on for the strategies to escape from its trap. Thank us later.

Extended Payment Plans

This strategy lets the borrowers repay the loan with the help of installments for a longer time than what was agreed in their original loan agreement. By setting up an extended payment plan, it involves getting in touch with your payday lender to work out an arrangement. This process doesn’t involve a fee, but defaulting on the payment plan can cost you fees and penalties. Or, you can also take cash loans from BC Loans.

 

Contact State Regulators

If payday lenders do not agree with the extended payment plans strategy, you can get in touch with the agency that manages and monitors the lenders in the specific state. State regulators may be able to help you out in cutting a deal with a payment plan with the licensed payday lenders. They also have the right to take action against the unlicensed lenders of payday loans.

Find an Alternative Lending Source

You can also look out for alternative lending sources like credit union or family member if you are unable to repay the payday loans. They are not deemed to erase the debt, but they have agreeable terms and interest rates. There are various loans available for various kinds of financial scenarios. One could be helpful to help you escape the payday loan trap.

Credit Counselling

It helps the consumers to manage their finances in a better way. It can help you with payday loan debts, budget creation and money management. Credit counselling services are usually rendered by many non-profit organizations. Credit counselling is not deemed to erase your debt, but it can help you manage your finances better. Also, not every credit counselling company is genuine. Research well before going for this option.

Debt Management Plans

A Debt Management Plan or DMP is a debt-relief option provided by the debt counselling agencies and debt management companies. They work with your payday lenders and plan up a monthly solution that works for your situation. In this, you need to deposit money into an account with an agency on a monthly basis which is then used to pay off your debts.