How to Consolidate Payday Loans with Bad Credit
Payday loans can be a lifesaver while in need of quick cash and struggling with bad credit. However, the high annual percentage rates that lenders impose have left many borrowers in endless debt cycles. When struggling with multiple payday loans or debts and bad credit, the situation can seem dire with no reprieve in sight.
What Is Payday Loan Consolidation?
Nevertheless, a payday loan consolidation could provide a much-needed escape route. Such loans are designed to group all high-interest loan balances into one. The loans are then settled by taking another loan but with a much lower interest loan referred to as a debt consolidation loan.
The strategy involves taking a personal loan from a bank or a credit union at a much lower interest rate and using the amount to pay off all the other high-interest-rate loans.
What You Need to Know About Payday Loan Consolidation
Getting a payday loan debt consolidation with bad credit is not easy. Lenders set requirements that people must satisfy while looking for consolidation loans. One of the requirements is a good credit score of above 640 which can be a challenge for people already struggling with debts.
Nonetheless, some lenders will approve a payday consolidation for people with bad credit but at a much higher interest rate or fee. The high-interest rate charged on a payday consolidation loan will never match the high APRs typical of payday loans. Given that the debt consolidations are issued by mainstream financial institutions they come with interest rates that don’t exceed certain levels as opposed to payday loans.
Payday Loan Consolidation: Getting Out of Payday Loan Debt help
Below are some of the ways to secure cost-effective payday consolidation loans with bad credit
Shop Around
Payday loans mostly appeal to people with low credit scores who think they can’t qualify for a payday consolidation loan. In the world of finance, there will always be lenders specializing in all kinds of credit solutions. Consequently, lenders will always be willing to lend to people with bad credit.
Regardless of how bad one’s credit may seem, shopping around, one is always sure to find a lender willing to lend at a much lower interest rate than what is always on offer with typical payday loans. There are platforms online that provide the much-needed details of the kind of offers that one is likely to get depending on the underlying credit scores.
Consider a secured loan
Most payday loan for debt consolidation is usually unsecured. With bad credit, it can be extremely difficult to secure such loans without any form of security. If you have a hard time getting approved because of poor credit scores, then seeking a secured loan to consolidate payday loans would be the way to go.
Secured loans come with a form of collateral such as a vehicle, a home, or another asset. A lender is likely to approve an application with such assets at hand. It is important to ensure that the collateral is worth enough to cover the loan in case of a default to increase the chances of approval.
Consider Payday Alternative Loan
If you are still unable to qualify for a normal payday consolidation loan, a Payday Alternative Loan (PAL) could be another option to consider. PAL is an effective payday consolidation loan issued by credit unions, as most come with a maximum APR of 28%. The low APR would significantly lower the amount of money in interest one ends up paying down the line on consolidating all the high-interest rates loans.
Real PDL Help: Payday Loan Consolidation & Relief that Works
Payday consolidation entails borrowing more money to settle high-interest rates loans. Getting out of debt can be extremely difficult on resorting to taking additional debts. This is one of the biggest downsides to payday consolidation loans.
The most effective way of reducing the impact of payday loans is not borrowing more. Instead, the focus should be on exploring ways of reducing the high-interest rates that payday loans come with. Real PDL Help would be of great help for people with bad credit and who cannot secure any form of lower interest rate loan to pay off high-interest payday loans.
Real PDL Help works by contacting payday loan lenders and negotiating for favorable and affordable repayment terms at much reduced fees and interest on behalf of clients. Instead of making multiple payments to different lenders, all the loans are consolidated, and one payment is made monthly on all the outstanding loans.
With Real PDL Help, the amount of money that payday loans borrowers end up paying monthly depends on a number of factors. First, it depends on the outstanding payday loan amount and the interest penalties payable. Nevertheless, borrowers can rest assured of being subjected to reduced fees and interest payments with the service.
As is with any debt consolidation mode, honoring a new debt repayment plan is essential for the service to work. Defaulting on negotiated monthly payments may result in the cancellation of the reduced payment plans.
