How Do Payday Loan Consolidation Agencies Work
Once you borrow a payday loan, the clock to pay it off starts then and there. It becomes crucial for you to pay off the amount that you borrowed during emergency else there will be other charged levied on it. Not paying these loans at all also affects your credit history negatively. However, most of the times, you want to pay off all your loans, but unfortunately, you just can’t. That is the time when you should move to loan consolidation agencies.
Let’s understand their level of functioning as follows:
- A Plan is Created
Firstly a plan is created to after analyzing the problem. For example: Any consolidation agency chosen to consolidate my payday loan will first check what and where the problem is. Is my credit history ruined already or I have genuine problems in paying this amount? These agencies then call up your lenders for making a mutual agreement.
This agreement includes an amount that you should pay and also the interest rates that should be brought to zero along with the time allowed to make partial payments. This further minimizes the total loan amount that you should be paying.
- Payment Made to Creditors
The loan consolidation agencies will help you come to a certain amount that you can pay almost every month or according to your payday. A small payment is automatically disbursed to your lender(s). This keeps your payment history intact with and also it makes you a regular payer.
- Make Total Payment of Your Loan Amount
The average rate of interest involved in payday loans ranges between 600 percent and 700 percent. When you involve a consolidation agency to help you pay off your loan, it helps you first to bring down its interest rates and the pay off the total amount in a much shorter duration of time.
- Your Loan is Paid in Full
If you are thinking to eliminate payday loans totally from your life, you need to reconsider your decision. Take help from loan consolidation agencies. These agencies help you in paying off the loan in full with no credit calls going to your place. You can enjoy total freedom from loan repayment.