Solutions to your Payday Loan Struggles
A payday loan is a financial solution that can pull anyone out of emergencies. However, once a payday loan can’t be paid on time, it becomes a major problem. The interest rate goes up, and penalties are included as well. If you’re struggling to pay back a payday loan, the worst thing you can do is ignore the problem. What you can do is to prepare for the necessary adjustments.
Here are the options that you can do if you can’t pay back your loan:
Communicate with the Lender
As a responsible borrower, you must maintain an open communication line with the lender. Do not clam up. Talk to the lender about your financial difficulties, but do so in a polite and humble manner. Humility is important because you’re pleading with the lender. Once you’ve made your point, you should hope for the best. The lender might offer you desirable and workable payment terms, or your claim will be denied. Either way, you must be 100% prepared.
Seek Help from Other Firms
In times of peril, other professional debt management firms can help you. As long as you can handle their fees, you’re good to go. These firms will help you deal with your loan effectively. They may suggest useful tactics and other repayment methods.
Seek Help from Your Friends
A friend in need is a friend indeed! This quote is very true in the lending sector. You can seek help from your friends and relatives. Your friends can very likely help you pay off the loan. Decreasing a fraction of the loan can really help out a lot. If your friends have helped you, you should return the favor someday.
Sell Some of Your Assets
The failure of loan repayment is a distressing life situation. In this case, you should play all possible cards that will get you out of your predicament. One of the most common techniques is to sell some (or all) of your assets. If you have a car, try selling that so you can have a lump sum to pay off the loan. Other assets that you can sell are collectibles, items, equipment, power tools, and many more.
Missing out few payments on your payday loan is not the end of the world. True, it’ll be inconvenient but you’ll learn a valuable lesson. The next time you take out a loan, make sure that you’ve planned accordingly and you can repay without troubles.
What are the benefits of a credit union?
Credit unions are small financial groups that accept deposits and give out loans. They are also sometimes considered as cooperatives and are set up by people with a common interest, such as where they live or work, and offer low-interest loans, savings and sometimes bank accounts. Credit unions are very popular to borrowers because of their convenience and fair rates.
Credit Union Basics
In a credit union, people who save or borrow must have a common bond. That means they might live in the same area, work for the same employer or have the same profession. They can also be members of the same church or trade union. They are run on a ‘not for profit’ basis. Instead of paying a profit to shareholders, they use money they make to reward their members and improve their services. Credit unions vary in sizes – some may have hundreds of members, while others have fewer. These unions are typically regulated by a larger financial organization that imposes protection limits for consumers and borrowers. Keep in mind that if you have deposited a larger amount than the limit, then your money is at great risk if the credit union defaults.
Credit Union Loans
In most cases, you need to be a member of a credit union before you can get a loan from them and some will require you to build up some savings first. Most credit unions will charge you an average of 1% interest a month as you pay off the loan. Some will charge less, others will charge more, although by law they can’t charge more than 3% a month (or 42.6% APR). In many locations, particularly Europe, the cap is set at 1% a month. There are also no hidden charges with credit union loans and no penalties if you repay the loan early.
Credit unions also include free life insurance at no extra cost – so if you die before repaying the loan, the balance would be paid off for you. Most credit unions can lend for up to five years on an unsecured loan and up to ten years on a secured loan (where they will lend against something like your property or car). However, this is not set in stone, and credit unions change their policies every now and then.
Before applying to your local credit union, make sure that you’re already aware of the responsibilities involved. Don’t just sign any agreement out of the whim. Read the fine print to know if the fees are manageable or not.