Firstly, you need to know what is a payday loan. These loans are kind of advance cash loans to your income. In other words, short-term loans that you need to repay within a few weeks or when your salary comes. There are so many factors of payday loans and only suggested to be taken when no other option left. This is because of a higher APR of around 300%-400%.
The lender provides you a loan based on your earning proof and you will need to write a check for the amount so that payday loans lender can convert it into cash on the due date. But in case, you default the repayment then extra heavy charges would be applied and you need to roll-over that loan on a more higher rate of interest.
Now, you can think that how important is to make prior planning of repayment of a loan. And if you want to get out of this worst situation then, you need to do the following:
how to get rid of payday loans
- Keep your all loans together: If you have taken several loans then it is kind of difficult to manage all and keep a record. So, in that case, you can combine your loans which makes your payments easy. Also, it may decrease your overall rate of interest.
- Put an end to another loan: Of-course, this is a common sense that if you are already in debt then you should not take another loan. In spite, you can divide your monthly salary into your expenses and refunding.
- Prioritize your expense: You should know which thing is important to spend money on and which is not because at that time you need to reduce your expenses to save more money than general. So that you can pay more than a minimum amount monthly.
- Demand for re-schedule your refunding plan: You can ask your lender to make a few installments of your debt if you aren’t able to pay the full-fledge payment. That can be so helpful for you to take care of your daily expenses along with the refunding of debt.
- Do extra work: If you can do extra part-time work along with a fixed job then it would help you to increase your income. You can search for work on weekends or holidays on an hourly basis.
- Sale of old unused things: It can be beneficial for you in two ways. One you can clean your house by selling those things which are waste for you and second, you’ll get some amount for them.
- Work as an Entrepreneur: If you have any skill, then you can work as an entrepreneur to earn some extra money. Like if you know about cooking then you can start your small business of food.
- Try to save money: If you can apply some coupons on shopping then that can also save money a bit but it’s better to save some money from nothing. As there are many offers run on groceries and other various things.
- Save something for urgency: You must keep some emergency funds to yourself. As it occurs at any time even when you are in debt already. Then what will you do? Take one more loan? NO, it would make your condition worse. So, you need to have some emergency money already for such situations.
- Stop spending money on extravagant things: There are so many things which you do for enjoyment only and spend a lot of money on them such as eating out, watching movies or for some holiday spot tickets. But if you stop spending on these for a few months then you can easily save a large amount to repay your loan.
- Make food at home: You can prepare anything at home despite eating out or packed food. Along with saving money that would be more fun also and you can spend time with your family. And healthy to eat. So, this trick you can use in normal days also.
- Schedule your earnings: This is very important to make a plan to spend your income. Try to plan for bills, grocery and few household expenses first which should be on priority. Then save around 30% or more for the repayment of debt. If you’ll not do the planning first, then you’ll not have any idea that on what you’ll spend how much so that you can save.
- Make money from extra things: You can make extra cash by clean your garage and sell things that are used less. If you can’t do any second job then this would be better for you.
- Work as Freelancer: You can do freelancing work as well as a side business. That can be a great help to you. Like if you know how to design a website then you can do extra work after your job and get projects of the same from online portals.
- Work with a car: You can earn some extra money from driving as well. Apps like Uber can give you a chance to decide when and where you want to work with your car as a cab. From this, you can earn a really good amount.
- Use Handed-down things: In case, if there is a need to buy something then you can opt to secondhand that would be around half a rate of new one such as furniture, gardening stuff, garage stuff, etc.
- Start working on credits: This is so important to do because if you need a big loan in the future then the credit score will be required and if you’ll not have good scores then again you’ll need to pay high interest. So, buy to manage current loans, you can create good ratings.
- Take advice from a licensed credit counselor: If you are really in the worst condition then you can take advice from Credit Counselors and they can find a great way to get out of payday loans.
So, there are many ways if you are trapped in this situation. You can do any of these things to get out of payday loans.