Is There No Way To Get Out Of The Payday Loan Trap?

Many people facing an emergency find themselves turning to a payday loan to meet their immediate needs. However, they often find themselves stuck in the Payday loan trap long after the emergency itself has passed. The main reason for this is the high interest rates that are charged on these loans makes it difficult to pay off the entire loan with a single paycheck. So, the loan rolls over, adding even more high interest and making it even more difficult to pay. It only takes a couple of payday loan rollovers until a person finds themselves trapped into what seems a never ending cycle of paying off one loan only to find you need another simply to survive. Is there no way to get out of the payday loan trap?

The answer is that it is possible to get free from dependence on payday loans and to get out from under the payday trap and escalating interest but, it is going to take some work and a lot of sacrifice on your part to get yourself free from the payday loan nightmare.

The first thing you need to do is to check and see if the company you have your payday loan through is a member of CFSA. If they are there should be a sticker on their door or a notice on their website bearing those initials. If they are a CFSA lender this is good news for you as you can apply for an extended payment plan.

What is an extended payment plan and how can it benefit you? An extended payment plan is a plan that allows you to pay off that payday loan out of your next four paychecks without incurring any additional interest or fees. If a lender is a member of CFSA they have to give you this option if you ask for it. You then sign an agreement that states that your payday loan will be paid by taking an equal amount from four paychecks totally the amount of the loan and all interest incurred up to the date that you asked for the extended payment. You must request this extended payment option at least a day prior to when the payday loan is due. By stopping the role over interest and having four paychecks to pay back the loan you are more apt to be able to pay the loan in full easier. However, keep in mind that this option can only be used once in a year with each lender and the lender must be a CFSA member.

If an extended loan payment is not available then the next step is to try and get a no interest loan from a friend or a family member to pay off the payday loan in full and then make arrangements to pay your friend back with affordable payments.

Cutting back on daily expenses is also an option that needs to be considered. Canceling that cable T.V., car pooling, skipping those dinners out. Making those sacrifices that are necessary to get you off the payday merry-go-round will be worth it in the end.

Once you are out from under those payday loans then start saving a few dollars out of every paycheck so that you have money set aside in the event you really need it.

It isn't easy getting out of the payday loan trap, but doing so will help to ensure a brighter financial future.