Nowadays more and more people are burdened with debt. Fortunately, there are ways to take handle your debts. Pay day loan debt consolidation is one of the most feasible options.
What is it?
Payday loans, or cash-advance loans, are short-term loans with high interest rates. These allow you to get fast cash when emergency situations arise before your payday. These loans have their pros and cons.
One of the significant disadvantages is that the interest of these loans can make your debt situation much worse if you don't repay the debt one payday after taking out the loan as interest keeps piling up with passing paydays. If this happens than you can consolidate your payday loans which would combine your balance from different cash advance loans into a single debt.
Advantages
These include:
· one monthly payment
· lower monthly payments
· lower interest rate
· fewer (or no) fees
· easier management of your finances
Payday Consolidation is just a convenience that allows you to manage your debt; you would still need to pay your monthly payments to pay the debt off.
Instead of dealing with multiple rates, creditors etc you only have to deal with one. This makes your repayments more manageable and increases the chances of you paying off your debt quickly.
Types of Payday Loan Debt Consolidation
Here are the main types:
1. Debt Consolidation Program
Companies that specialize in debt consolidation will negotiate with your creditors, and will try to lower those interest rates. The result would be that you would get a single interest rate that is significantly lower than the average of all the rates you are paying on your currents loans.
2. Consolidation Loan
This type of loan requires you to make a single monthly repayment to one company. Consolidation loans have longer repayment periods and higher interest rates than debt consolidation for payday loans.
Choose the most convenient payday loan debt consolidation considering your payday loan situation and general personal finances.
