What Payday Loan Debt Does To Your Finances
Payday Loans Costly Financial Game – Though some may see it as a quick fix, payday loans are however a slippery slope that slides individuals into a never-ending cycle of debts with zero chances of getting out. These are high-rate loans offered to high-risk individuals and are designed to last until the borrower’s next payday. This type of loan service is dated back to the Civil War Era, where borrowers paid interest rates above 500%.
Payday Loan History
The service also played a significant role in the 1929 Wall Street crash. Despite the government enacting laws to discredit these manipulative lending practices, these businesses are still in operation. Approximately 12 million Americans take a payday loan each year. This is because nearly 58% of the total population have trouble meeting their basics monthly needs such as rent and utility bills. Payday loans seem handy at such a point that a vast majority of Americans see it as the only getaway to accessing credit.
How Do Payday Loans Function?
The streets know them as financial mobsters. They come and entice you when you are at your worst financial crisis with a solution that will fix your problem. Depending on the state’s legal maximum, the loan amount ranges from $100 – $1000with an average annual interest of 400%. To borrow $100 a finance charge ranges from $15 to 30 for the period agreed. The rates are higher in states that have not regulated these lending practices. The fast and easy access to finance makes it a better option for borrowers. However, right when you think you are out of the woods, they come knocking. The downside is that by signing up to the service, you automatically give them access to your account which allows them to deduct what you owe together with the additional charges leaving you with almost nothing. Thus, only a few get to survive until their next payday while the majority of borrowers wind up in the lending cycle.
Types Of Payday Loans
There are various types of payday services that exist today. They mostly come in the forms of cash advances, timely loans, and instant online lines. The most common types include;
- Instant online
- Military
- Check/Cash advance
- 30 – Day payday loans
- 24 – Hour loans
- One-Hour payday loans
Why Are Payday Loan A Bad Idea
Despite being a good financial emergency in the middle of a crisis, these loans do more harm than good. Payday Loans’ Costly Financial Game is the biggest issue due to its huge interest rates. Considering the fact that most of its clientele are people living from pay-check to pay-check, the majority are unable to sort out their issues and thus forced to take another payday loan. This creates a cycle that allows the borrower to pay the interest while the loan amount remains outstanding. However, several states in the country have banned the operations of payday services. Such states consider it abusive for lenders to charge such high-interest rates.
State Restrictions
For the states that these services are still available, the lenders offer an easy and smooth application process. Some clients may view this as good customer care service. On the fact sheet, it’s a strategy used by lenders to keep the money rolling. Most people resort to payday loans with the plan of using them for a week or two but end up being unable to pay back on the due date. Thus, every time an individual defaults the original interest fee is charged. In due time these charges exceed the initial amount borrowed. This forces them to end up in cycles of debts that are difficult to come out.
How To Escape The Payday Loan Trap
Consumers fall into the trap of payday lenders due to bad credit and lack of savings. For those lucky enough to have evaded these money sharks, it is important to adopt safe financial strategies such as avoiding bad credit and adopting a culture of saving. However, for those already in the mix, National Payday Loan Relief has a permanent solution for you.
Payday Loan Settlement Company
A trusted payday loan debt settlement company that is out to help individuals who are dependent on payday loans and need assistance to manage their finances. National Payday Loan Relief provides an effective payday relief programs which includes many benefits such as payday loan debt counseling, payday loan consolidation & payday loan settlement services that help in alleviating recurring financial liability. For instance, through the organization, individuals learn how to escape payday loans’ costly financial game by restructuring their financial life.
Through their payday loan relief program, borrowers have the following advantages:
• Opportunity to reduce their total loan amounts
• Make flexible monthly installments of low amounts
• Stop the debt cycle by structuring financial goals
• Avoid the repercussions of defaulting such as lawsuits and bankruptcy
• Improved credit & good financial habits
• Access to expert credit counseling
• Make flexible monthly installments of low amounts
• Stop the debt cycle by structuring financial goals
• Avoid the repercussions of defaulting such as lawsuits and bankruptcy
• Improved credit & good financial habits
• Access to expert credit counseling
The organization’s Payday Loan Consolidation strategy is designed to clear all the client’s debts in due time. The company takes the initiative to roll the outstanding balance of the loan amount into smaller payments that are affordable to the borrower. With this simple payment, one doesn’t need to continue struggling with the payday loan cycle.
Payday Loan Settlement Counsellor
NPLR strives to ensure its clients are free from cycles of debts. The organization promotes financial freedom by reducing and eliminating payday loan services. Through the counseling service, NPLR consumers have the opportunity to kick start their road to recovery from a financial crisis. A debt counselor provides knowledgeable insight on ways in which an individual can reduce their payday loan debt. They further provide information and access to programs that allow clients to reduce and eventually clear their debts. Counselors at NPLR also offer debt management tools that allow clients to better manage their finances.
Payday Loan Relief Programs
This program allows the borrower to pay a lot less on the outstanding loan debt. The client has the opportunity of rolling down the debt into one payment thus preventing further borrowing. Moreover, it offers much lower interest rates keeping the total loan amount to a minimum. When people look at the cycle of debt they are entwined in, the first option is for them to be declared bankrupt by the courts. This always seems like the best option at the beginning but in the end, the problem persists. Moreover, being declared bankrupt ruins an individual’s credit score denying him access to certain financial services. Payday loan relief programs and loan consolidation come in handy at this point. The two programs allow you to break the cycle of debts once and for all.
National Payday Loan Relief
Since its establishment, National Payday Loan Relief is committed to helping people regain their financial freedom by ending the cycle of living from pay-check to pay-check. With reliefs and consolidation programs borrowers now have nothing to worry about regarding the financial position and credit score. However, to be free, you have to make a decision. Which way to go, bankruptcy or debt consolidation. In case you opt for the latter, we as NPLR we are here all step of the way to offer you undivided attention.
