Business and Finance Times

Most people in US use payday loans for meeting their short term or urgent needs. Are you one of them and trapped under payday loan cycle. Sometimes, people take new payday loans to pay their existing loans and it keeps repeating until it gets to an overwhelming situation. Don’t take a payday loan in the hopes of paying another loan that is current. People in such situation are already going through a crisis and taking another loan might make things worse. It will be hard to make ends meet. Now the question is how to break this payday loan cycle and pay it off? Follow these five practical ways and you will see a clearer picture of coming out of the payday loan trap.

1) Stand against the payday loan industry: Every state has certain laws on payday loans. For example, in Oklahoma, borrowers who have taken out payday loans in three consecutive times can repay their loan balance in four equal installments. This is a good opportunity to break the loan cycle and pay them off. Take advice from your local attorney general’s office. They should be able to tell you more about your state laws and how to handle your overwhelming debt issues.

2) Pay off the payday loans at the earliest: If you have borrowed a payday loan, it’s important that you pay back the principal amount and the accrued interests. Make arrangements to pay maximum portion and the amount should go towards the principal. Don’t pay a small amount that goes only towards the interests and fees. You should figure out to pay back from your next pay check without getting a new loan. You might see yourself in a tight spot but ultimately you will be doing something to get this big burden off your shoulder. There is no harm if you have to live in crisis for a temporary period.

Some ideas to cash out money to pay loans:

• Have a yard sale or garage sale. Put anything that can be sold such as furniture, clothes, gifts, watches, jewelry and etc.
• Sell a few things in your local newspaper’s free ads or sell them online at eBay.
• If you are under employment, you may discuss with your employer to get an advance salary and repay it over several pay periods.
• Borrow from your family or relatives to pay off your payday loan and repay them over several pay periods.
• Get a second job or part-time job to earn extra money to clear your debt.
• Cut down your monthly expenses and optional spending such as entertainment, clothing and vacation to save more money to pay into your debt.

3. Get Help from Credit Counseling Service: You must take assistance of a professional expert to come out of your debts. There are some Consumer Credit Counseling Services (CCCS) that are non-profit counseling centers. They can offer you financial advices based on your individual situation. He will analyze your financial situation and figure out how much you will be able to afford in repayments. The counseling can turn out to be helpful because you will have a variety of options to choose from and walk on the path to being debt free. They might offer you some kind of repayment plan and stick to it if you decide to go for their program. You don’t have to enroll into their services but if you decide to do so, they might charge you a fee to meet up the cost of their services.

Summary

Don’t stay isolated with your payday loan problems. Discuss about your situation with your near and dear ones or if you need to take professional help, go for it. When you are able to work out your own ways to come out of the payday loan cycle, you will see yourself in a better situation and become free from payday loans sometime in the near future.