If you’re having trouble keeping up with payday loan payments, you’re not alone. About four out of five borrowers eventually have payday debts that they can’t pay off within the initial two-week timeframe. It’s essential to fully understand the potential consequences and what you could do about them. Here’s what to do if you can’t pay off your payday loan.
Many lenders offer “rollovers” to customers who can’t afford to repay them. This means that you must pay an extra fee to delay the due date. The additional charge doesn’t decrease the amount you initially borrowed. Depending on where you live, there may be a maximum number of allowable rollovers.
If you can’t pay for an extension or choose not to, the lender will probably attempt to withdraw the full amount from your checking account. Inadequate funds usually result in a late charge and a bank overdraft fee. Next, some payday lenders attempt to withdraw smaller amounts, possibly triggering further overdraft penalties.
You’ll also begin to receive phone calls demanding repayment. As time passes, the debt could increase due to additional interest and fees. Many lenders attempt to gain payments for approximately two months. They’ll likely transfer the owed amount to a collection agency after this time period. The debt collector will contact you repeatedly, and negative information may appear on your credit report.
Some agencies initiate lawsuits against borrowers who can’t or won’t pay them. Legal action will force you to appear in court; the police may arrest you for failing to show up. A judge could give the lender or debt collector permission to seize your income from employment or other sources.
Fortunately, you can find multiple ways to avoid this predicament. We can help you pay off your payday loan. You might have the ability to consolidate your debt into a single loan at an affordable rate. It’s also possible that you could settle payday loans by paying a smaller amount. Please contact us today to learn more about effective debt relief solutions.