Consolidating payday loans into one easy monthly payment can be a little more complicated than just doing the obvious thing and giving the payday lender a loan and depositing it. This can cause problems that can’t always be solved with a simple explanation.
As you can imagine, the lending companies have specific rules and regulations in place that make it difficult for someone to get approved for a loan that will cover all of a person’s expenses until the next person’s paycheck arrives. They expect the applicant to put down enough of a deposit before the lender will make an official offer.
They are also in the business of taking money from those who need it the most and lending it out to others who don’t need it and they like it because the money is returned in lower interest rates. So how do they handle this if you consolidate your payday loans into one?
For starters, they will take care of their obligations to the first of their customers who qualify. If they think that you may qualify for bad credit because of financial difficulties in the past, then they will take a look at your credit rating. If you do not have a good credit rating and pay the money back on time, then they may choose to deny your application or issue you a summons to appear in court.
If you are a high income earner and you cannot make the high interest rate, then you may want to rethink the concept of consolidating payday loans. Your loan amount will increase so you should really consider your spending habits. Instead of getting multiple loans, do one or two and then pay off the principle.
Each time you go into the store, shop around for the best rate on multiple payday loans instead of one. You can get a good deal by finding the best rates on that particular loan. If you get a discount and pay your installments on time, you can save money and have more money to use in the future.
Be sure to only get loans that will take care of your basic needs until you can pay them back. Don’t take out a single payday loan when your need for cash is minimal. Payday loans can be dangerous because they don’t cover all of your expenses when the loan comes due.
If you have bad credit and no money but need some emergency money, then it is very easy to consolidate your loans and make it easy for you to stay out of debt. There are certain fees that apply that can really add up. Make sure that you compare different lenders and their charges.
One of the fees that you need to be aware of is the late fees. Late fees can run as high as $50 a month if you pay on time. The interest rate of the loan is another important factor to be aware of.
There are lenders who will apply a large number of late fees to your loan. It is a good idea to get an idea of what fees other people have paid for the same type of loan that you are applying for. This will give you an idea of what to expect as well.
Some companies charge very high interest rate to get a payday loan even though they are in trouble financially and need the money very badly. The lender will choose to charge you a lot of interest in order to make it worth your while to get the loan. While you are consolidating your payday loans into one, do what you can to lower your interest rate.