Don’t Fall for These
Payday Loan Tricks
If you’ve taken out a payday loan, or are thinking of taking one out, then it’s likely that you’re already struggling with money. After all, such loans are typically a last resort, and you may even be taking them out to cover the repayments of an existing loan. But while this approach will buy you some breathing space in the short term, it could have disastrous consequences to your finances over the long term. The more debt you get into, the more you will have to pay off- and it could easily reach the point where your repayments outstrip your income. In these cases, your only option will be to go to a debt management company, who will either help to restructure your debts or suggest you declare bankruptcy. Of course, you’ll want to avoid this wherever possible- which is why we’ve written this post to guide you in the right direction. Read on, and we’ll explain why you should avoid payday loans wherever possible, so that you don’t end up struggling with debts that you can’t handle.
When You Shouldn’t Take Out a Payday Loan
First things first, if you’re thinking about taking out a payday loan to repay an existing loan- don’t. That’s because these loans typically come with much larger interest rates than ordinary loans, which makes them extremely costly in the long run. While the government has stepped in to limit the interest you can be charged on loans to combat this, this hasn’t completely erased the issue. Instead, companies charge extra fees, which are uncapped by the government, so that they can still squeeze as much money as possible out of hapless borrowers. If you’re already struggling with debt, then the last thing you want to do is make the problem any worse.
Watch Out For “Rollovers”, Too
If you have already taken out a payday loan, then it’s best if you can repay it in full as early as possible. That way, you can avoid the lion’s share of the interest on the loan and prevent your debt from getting out of hand. Be careful, though, as the loan companies don’t want you to do this- instead, they want as much money as possible out of you. When you get near the end of your repayment period and are keeping on top of the payments, the loan company might get in touch to offer you a rollover on the repayments. They’ll make it sound like a tempting offer, but it will actually come with plenty of fees that increase the amount you owe. For that reason, you should stay on your toes when dealing with payday loan companies, and look into things for yourself before you accept anything.s
Speak to Someone Who Can Help
The best step you can take when burdened with more debt that you can cope with is to speak to a specialist debt advisor. While you might think the only way out of your situation is to repay the full amount of your loan, this is rarely the case. They may be able to restructure the debt or come to an arrangement with your creditors to pay your loans back in smaller amounts. Instead of letting the payday loan company suck more and more money out of you, it’s time to hit the reset button. Get in touch with the professionals, and see what can be done to get out of debt today.
What Are Your Rights When
It Comes to Payday Loans?
As anyone who has ever struggled with debt repayments will know, debt collectors can be more than a little intimidating. In fairness, this is only to be expected- after all, their job is to get creditors their money back, so they have to do all they can to get this job done. However, this doesn’t make things any easier for those being targeted by these debt collectors. As well as being a pretty stressful experience, dealing with debt collectors can also lead to plenty of misconceptions about what your rights are with payday loans. The collectors will imply certain things- like them having the power to force you to pay up- but unless they explicitly state something, you shouldn’t take their word for it. To help cut through these misconceptions, we’ve written this article that explains your rights in these situations. Don’t let debt collectors push you around. Instead, read on, and you’ll know exactly where you stand with your payday loan.
Payday Loan Companies Have Obligations to You, Too
When you take out a loan, you’re signing a contract with the creditor. With any sort of contract, there are always two parties involved, and that goes for loans as well. Not only that, but any loan company has to abide by a strict set of laws set out by the government, and intended to protect individuals who take out loans. These obligations on the part of the loan company will often be buried deep in their terms and conditions, but they still apply.
For instance, all loan companies are obliged to point you towards free, unbiased debt advice if you ask for it. Few people are aware of this, but it would certainly come in handy for thousands struggling with debt. But that’s only scratching the surface of loan companies’ legal obligations. More importantly, they also have to treat all of their borrowers fairly and with consideration. More than just empty words, this means that if you can’t afford to keep up with your repayments for any reason, they have to at least consider freezing the interest on the loan or accepting smaller token payments while you get back on your feet.
Debt Collectors Can’t
Hassle You Either
There are also restrictions on how payday loan companies can communicate with you, too. While they are allowed to contact you regarding your debt, they can’t bombard you with a heap of emails and phone calls demanding that you pay up. Remember that debt collectors don’t actually have the legal power to repossess anything or take money off you- only bailiffs possess this power. The main reason why these debt collectors can do their job is because the people they deal with don’t know the difference. If you know your rights, though, then you can avoid falling into their trap, and stop them pushing you around.
The easiest way to get these debt collectors off your back is to speak to a debt advisor. While you’re arranging a repayment plan with such an advisor, then loan companies are forbidden from contacting you. What’s more, depending on the plan you come up with, they might also have to conduct all future communication with your advisor as well. They won’t be able to mess your advisor around, and you’ll be well on the way to clearing your debts as well.