If you’re looking to borrow money, chances are you’ve been approached by payday loan companies. They often claim that their loans are easy to repay and that they’ll cut through the red tape for borrowers, but in reality, it’s the other way around — even though many borrowers end up owing interest-bearing fees and paying down nearly double of what they borrowed in total. This article will show you an alternative path out of this cycle of debt that doesn’t involve borrowing more cash or taking on a new contract.
1. Don’t Break The Law
Although some states are considering legislation that makes it illegal to make false or misleading statements at the point of sale, payday loan companies continue to wrongly advertise the terms of their loans when making a loan. In fact, one study found that half of the borrowers falsely believed they had a right to be paid interest on their loan balances initially and accepted loan terms even though they admitted they didn’t understand them.
2. Don’t Expect To Get The Same Loan Terms
If you took out a payday loan in the past, you already know that interest rates exceed 365 percent and that the idea of repaying your entire debt all at once is nearly impossible. However, there is a way to get out of debt without investing more money into your balance — but it won’t be easy. If you want to avoid costly fees and high-interest rates, you’ll need to contact your lender and ask them to lower your payment terms.
3. Negotiate Lower Interest Rates
You can use a debt consolidation loan to consolidate your payday loans and lower the total amount of money you owe but beware of companies that promise to clear your debt for a flat fee. Some companies will offer you a contract that includes fees and interest, so make sure to read the fine print carefully.
4. Fight Back
If you believe you’ve been taken advantage of by a lender, you don’t have to let them get away with it.
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