From time to time, we all need to get our hands on extra cash quick. Perhaps you’ve had an unexpected automotive or appliance problem, or maybe a loved one has fallen ill and requires some extra medical assistance, and you simply don’t have time to save up and accumulate the extra funds.
Getting payday loans can be beneficial in various situations, giving you more flexibility with your finances. However, the day will come when the loan needs to be repaid. The vast majority of payday loans are due in full on the day of your next paycheck, although there can be wiggle room depending on your situation.
Here are seven tips on how to pay off payday loans and have one less worry on your mind:
1. Look into consolidation through a financial source
Although consolidating payday loans can be a bit tricky to navigate, it is possible and it can end up saving you money. One way you can do this is through a financial source. In this case, you are essentially consolidating your payday loans by taking out a personal loan. Although this method won’t end up saving you on overall interest, it will break your payment schedule down into a structure that is easier to manage.
2. Explore these additional loan options
When it comes to accessing additional financial sources, there are a few different avenues you can pursue. If eligible, you could look into accessing a home equity loan. If you don’t currently have a lot of equity, you could also apply for a private loan through your bank or credit union.
Keep in mind of this top on how to pay off payday loans. Worst case scenario, you can think about borrowing the money from a trusted friend or relative with whom you agree on a date or time frame for the money to be paid back.
3. Consider a payday loan consolidation program
There are in fact many programs available that can help you get out from underneath your loan debt if it becomes simply too much to manage. Many of the organizations that offer these programs work closely with lending institutions to reduce interests and generally make your payments more bearable.
If you’re starting to feel overwhelmed, it is also a good idea to inquire. If approved by a loan consolidation firm, the outcome is that the lender will take payments from you that will be relevant to your debt. Some debt consolidation companies are set up so that they are paid a single monthly payment by customers and it is distributed by them among creditors such as payday lenders.
4. Transfer the payday loan to your credit card
Although not an ideal option, there is the possibility of using a credit card to repay a payday loan. Problematic in its own right, it is still better than not paying the debt at all. Interest rates on credit cards are high, but usually lower than those on payday loans.
If you have it on your credit card, it is also possible to get a payday advance. There is generally a fee for this although most credit card accounts holders may take some cash out. Assess your own credit card FAQs and TOS to determine not or if this could be a viable option in your circumstance.
5. Ask about a hardship program
Financial situations can change rapidly. Whether due to a layoff or a medical situation, you might not be able to pay your loan back on the previously agreed date. In the event that something unexpected has happened, you should enquire as to whether or not your lender has a hardship program in place. If eligible, this will typically entitle you to an extended time period and possibly even reduce the total amount you have to pay.
6. Don’t be afraid to negotiate
Not getting afraid to negotiate is another tip on how to pay off payday loans. If they don’t have an explicitly stated hardship program, you should still ask about whether or not a negotiation is possible. We all know that lenders are in the business to make money on their loans, but it is also important to remember that they want to ensure they get their money back. If you truly find yourself in an impossible situation, they will likely be willing to discuss alternative arrangements.
7. Borrow payday loans thoughtfully
Although payday loans can act as a valuable resource when you don’t have cash available and need to deal with an emergency, they should be relied upon when absolutely necessary. Ultimately, they will end up chipping away at your income and could even end up leaving you in a pretty stressful situation.
With that being said, if you think your situation requires one, just be sure to weigh the risks of taking the loan out before applying. No matter what, ensure that if you do take the payday loan, you will be able to cover it based on the arrangement you make with the lender. Always explore all your options and try to avoid any hasty decisions.