Payday Loan Consolidation – How to Get Help

You figured a Payday loan would help. Just one easy loan to tie you over until you received your next pay or cash injection. Then you could pay it back and now have to deal with late charges on top of the repayment. Unfortunately, you still have bills and needs such as groceries, petrol, rent and other household expenses. It has quickly spiraled out of control and now you cannot see the end of the repayment and you are deeper in debt.
If this sounds like you or similar and you need help getting out of a payday loan, you do have options as outlined below.

Community Financial Counsellor
A smart first option is to contact a community Financial Counsellor that is provided as a free government service. These counsellors can help you in a variety of ways if you have gotten yourself into financial difficulties including payday loans. There are counsellors in most communities or you can find one close to you here. You can also simply talk to one on the phone if that is easier.

These financial counsellors are trained in consumer finance and can help you with more than just your payday loans, although they will obviously be the first priority. These counsellors can reassess your entire financial situation and see what the best course of action is. They have contacts and resource to help with your situation.

 
With payday loan interest rates, fees, and penalties being quite high, you will definitely want to either pay it down as quickly as possible or look at all the alternative means of financing to consolidate the loan. One of the first options the counsellor will look at is a repayment plan directly with the provider. As all creditors in Australia have to negotiate repayment agreements if contacted to do so, if they refuse they are doing so illegally.

Also, these payday lenders tend to remove money through direct deposit. One way to gain control over payments is to put a stop to direct payments at your bank, removing this option from the creditor.

Consolidating or Reducing
The other true options for getting out from the debt of payday loans is deciding whether to consolidate them with other debt into one single payment or if you can simply reduce your overall expenditures and work out a payment plan.

Your first choice should be a full assessment of your situation to see if you can reduce and do it yourself before getting a consolidation loan. In order to do this you would need to be willing to sacrifice everything but the bare necessities in order to get back on track. You could sell assets, reduce your spending and go with a repayment plant to do it. If you have no room in your budget or life to downsize, your only remaining option may be a consolidation debt loan.

However, always use a reputable company and one recommended by your financial counselor. These companies can vary widely on their pricing structure and you can end up paying more in fees as you take the loan over a longer period.

 
BE CAREFUL of Debt Consolidation & Budgeting Companies
Whilst these types of businesses do provide financial services, they come at a cost. Depending on your financial situation and amount of debt, these may not be a good option as they may only assist in reducing your monthly repayments while extending the life of the loan repayment; costing you thousands more in interest repayments and fees.

If considering one of these businesses, be sure you understand the costs and terms. Also, have them provide any costs in a dollar amount versus a percentage. Essentially makes sure there is a short and long-term benefit to you. As mentioned earlier in the article, you may want to consult with an unbiased free, professional counselor first.

In addition, why pay a person to help you with your budget, this is something you can easily do yourself. Have you ever heard of bill smoothing? See how this simple budgeting tactic can make an enormous impact on your finances – learn more here