When is it time to consolidate?Leave a Comment
You may have taken a payday loan because you require extra funds at that point in time. However, as time goes by, you may find that you are struggling on a monthly basis. You have to manage your monthly expenses, pay the bills and still pay your creditor some money in order to clear the payday loan debt. ‘How do I know that it is time to consolidate?’ you ask. Read on to get a better idea on when you should seek out a favorable payday loan consolidation program. If you are facing some of these situations, you should definitely consider consolidating your payday loan debt:
1.Your income is not enough to cater for your current expenses and loan repayment
This is an indicator that you are struggling with debt and may risk defaulting your loan repayment. Also, the interest on your loan amount may increase over time, making it harder for you to clear the debt with your limited income. This issue can be resolved if you choose to consolidate your loan which can lower your debt significantly. The debt consolidation company can negotiate for favorable loan repayment terms for you as well as lower interest rates on your payday loan.
2.You are constantly hounded by your payday loan creditor
It is frustrating when you are constantly being bombarded by the same message from your creditor: Pay up! Pay up! Pay up! If the payday loan company calls or emails you on an almost daily basis pressing you to settle your debt, you know that there is a real problem and you have to fix it. You may have to consolidate payday loans to get out of debt and get away from the constant pressure from your creditor. With debt consolidation, you will only make a single payment to the payday loan consolidation company and they will forward your repayments to the creditors.
3.Your creditor is garnishing your wages for repayment
When you are unable to control your finances, the creditor may make a move to get you to repay the money you owe them. This may mean garnishing your wages for debt repayment. In this case, your employer will deduct the amount owed to the payday loan company until the debt is cleared. However, this may not be good for you because you will not be able to control your monthly budget. If your wages are being garnished by your payday loan company for debt repayment, you may have to consider consolidating your payday loan debt because this gives you a chance to make repayments with money you are able to part with. You can also benefit from the lower interest rates which may be negotiated for you by the loan consolidation company.
4.The payday loan company summons you to court
Should you have been summoned to court by your creditor, definitely think of a way to get out of debt as soon as possible. Filing for bankruptcy may not necessarily be the best way out. So consider debt consolidation. This may do more good for your credit score as it will give you a chance to clear your debt.
We hope you now have an idea when you should consider payday loan consolidation to turn your situation around. You should not wait until circumstances are really dire before considering loan consolidation. You may consider debt counseling so you will know whether debt consolidation is the best way to go given your situation.