How Do I Settle My Cash Advance?
Cash advances can be so tempting when you need cash right away. However, these loans have incredibly high interests and often leave you wondering, how am I going to settle my cash advance ? In fact, payday loan fees can vary from $10 to $30 for every single $100 you borrow. That can unfold to an APR of 400 percent or more, equating to credit cards, which typically have an APR of around 20%.
Nevertheless, if you already own a cash advance loan, the only way to avoid a great deal of stress as well as uncertainty about the future is to pay. This is because failure to pay can get youtrapped in a cycle of debts , since cash advances can hit you with fees for not repaying in full or on time.
What If I Stop Paying My Payday Loan?
If you stop paying your payday loan, you could face a number of challenges, including:
1. Debt Collection Activity
Your lender may try to collect the payment from you for about sixty days. If you 're unable to pay by then, they'll mostly seek the help of a third-party debt collection agency. These agencies will regularly send you letters as well as call you until you pay. They're far more aggressive than your lender.
2. Additional Fees and Interest
Depending on the lender you choose as well as where you live, you may face extra charges if you stop repaying your cash advance. These fees are known as nonsufficient funds, and they apply when you lack finances to cover a transaction.
3. Court Summons
Even if it 's a small amount you've failed to pay, some collection agencies will take you to court. And depending on your location, this may lead to wage garnishment or even liens against your property.
Does an Unpaid Payday Loan Affect My Credit Score?
Typically, your score won 't be affected by a cash advance as long as you repay it on time and in full. Nevertheless, if you fail to repay your cash advance loan and you're forwarded to debt collection agencies, the debt collectors may report you to major national credit bureaus. This dramatically impacts your credit score.
How Do I Settle My Cash Advances by Myself?
The most common and less stressful way to settle your cash advances is by paying them on time and in full. Nevertheless, if you can't meet the repayment day, there are a few ways to help you lower the financial burden.
- You can consolidate your cash advances, which helps you reduce the amount of interest charged. In consolidation, the debt is moved from multiple accounts to one account, essentially with a lower interest rate. You should, however, remember that applying for another account can negatively affect your credit score.
- You can attain debt relief by negotiating with the creditors to significantly lower the amount you owe . Seeking professional assistance from a company like DoNotPay can get you better results due to their experience in such negotiations.
Settling My Cash Advance with The Help of DoNotPay
If you cannot complete your cash advance payment on time, don't give up yet. Here are your options:
|Request to Be Listed On a Payment Plan||If you're unable to make your initial loan payment on time, you can ask your lender to place you on a payment plan where you can pay back the amount you owe in several installments. In some states, the lender is expected to grant you an installment plan without any additional fees. Unlike payday loans, payday installment loans are repaid in multiple installments over an agreed loan term.|
|Ask for an Extended Payment Plan (EPP)||Many cash advance lenders are part of the Community Financial Services Association of America (CFSA) and permit borrowers to get into an Extended Payment Plan. In this plan, you're given more time to repay your loan without being subject to extra charges or interest.|
|Negotiate Your Terms||While this process isn't a guarantee, in some cases, your lender might be willing to negotiate your repayment terms, including APR and interest fees. There's no harm in trying it out.|
So how does DoNotPay help?
Through our Negotiate Your Payday Loans Product, we'll by design generate a negotiation letter that you can send to your lender to appeal better terms on your loan. All you have to do is:
- Search for "Negotiate Payday Loans" on DoNotPay
- Enter the state where you collected the payday loan
- State the amount you borrowed, the date you collected the loan, and when your payment is due.
- DoNotPay will then automatically calculate the APR of your loan and determine the best possible way to negotiate your case, depending on the amount.
- You're now all set! You can generate your personal negotiation letter with just a click and use it to reach out to your lender for better loan terms.
What Else Can DoNotPay Do?
- Financial aid appeal letters
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Get in touch with us today for more information.