During difficult economic times, most people turn to payday loans for survival until their payday. Payday loans are offered at different cash stores. However, each cash store has its own procedures and terms that should be followed. Some of these terms may be harsh to the borrower in case they default payment of the loan. Therefore, it is important to understand a few ways through which you can settle your payday loans without facing the harsh terms.
Know your lender
Write down the different payday loans that you have and break them down in to two categories; mortar stores and Internet stores. Ensure that you indicate the amount you borrowed and paid to each store. This is very essential since payday loans are settled differently depending on the terms stated by the lender, the payday loan category you chose and the laws governing the use of payday loans in your state.
Understand your state licensing laws
To have a successful payday loan settlement, you should understand the licensing laws. Verify whether the law requires online payday loan lenders to be licensed in your particular state or other state licenses are allowed. However, most states require the online payday loan lenders to be licensed before performing any business transactions in the states. Since most online payday loan lenders do not have the necessary licenses, you can tell them off and fail to pay the loan.
The Community Financial Services Association of America is dedicated to ensuring responsible regulation of the payday loan industry as well as protecting the borrowers. This association works closely with policy makers and advocates to ensure that financial safety and well-being of the borrower is catered for. Additionally, the payday loan lender who belong to this association have the responsibility of setting up a favorable repayment plan for their borrowers who are in distress. However, to get a payday loan debt settlement with the CFSA members you must have filed a request before defaulting on payments. However, since the CFSA members are legal, be prepared to pay your full plus interest and additional fees. Otherwise, if you default the payment, you can be sued for the loan amount plus court cost and attorney fees.
Close your bank account
You can close you checking account through which you receive your monthly salary. Request a regular check from your payroll department until you have sorted things out and you can open a bank account again. After closing your bank account, revoke each debt authorization through sending a letter to ACH debit authorization to each lender involved. In addition, make sure you revoke any wage agreement that you may have signed with the lenders and submit a copy to your payroll department. You can now settle your payday loan debts at your convenience. However, ensure that you never share your new bank account details or credit card information with any payday lender. Once you have reached a settlement, ensure that you pay through prepaid debit cards, wire or money orders. Click here to see news about finances.