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Is Payday Loan Consolidation a Good Way Out

June 8, 2011 11:53 AM EST | Debt Consolidation | Email to Friend

When traditional lending institutions are running stringent credit check before loaning money, payday loan companies are offering cash advance without any credit check. Within 24 hours of payday loan application one can obtain cash advance in a speedy and hassle free manner. Therefore, it is a great temptation for many of us to tend towards payday loans at any slightest provocation. But given the high rate of interest, most of us have propensity to default on payday loan account. In this circumstance, payday loan consolidation may be a suitable solution to get out of the vicious cycle of payday loan debt.

If you have taken multiple payday loans and you are unable to pay them off, you can consolidate them all and pay through a singular payday account. This method can help you pay off your debt in a better way and you would be in a comfortable position to bear the debt pressure as long as you carry payday loan term. Thus, your total monthly payment amount will be chipped away. However, if you contact any consolidation company they can help you to reduce the interest rate of your entire payday loan debts. They will negotiate your payday lenders to restructure an affordable payment scheme for you.

Get Payday Loans

You can also take payday consolidation loan to pay off your entire loans. This type of loan maintains a set form of interest rate. Availing this you will be able to better manage your entire payday loan debt. You can apply to a bank and credit union to obtain payday consolidation loan. If you apply a signature loan, then you would not need to show any collateral. But if you like, you can put your car as collateral to get better term for your payday consolidation loan.

Payday loans are sometimes called as payday sharks. These are generally short term loans that demand immediate pay back within next payday. If you miss payment consecutively, you could find yourself in a dangerous situation. You may end up bearing interest rate with 200% APR. So, you need to consider wisely before taking a payday loan.

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