Are you slowly sinking under the burden of your payday loans? Are you feeling encumbered and completely clueless as to how to reduce your debt? This article aims to discuss some methods or ways that can help you to find a lasting solution or at least cope with the situation better.
Why are personal loans better?
Personal loans like term loans or installment loans whether you are considering them for a long term or a moderately long term or short term are the best option if you are thinking about managing a big investment or you need to money to meet your recurring shortfalls. A payday loan can get you through a very short-term crisis but if you fail to pay the principal along with the interest, the debt will mount and you may have to pay an APR (annual percentage rate) in excess of 400%. It is one of the costliest financing options.
On the other hand, a short-term personal loan or a term loan has a fixed repayment schedule, a fixed rate of interest, is much more transparent, provides more legal protection to the borrower and is easier to pay off as they give more time and the interest rate is manageable.
For example, flex loans from Cashco Financial are consumer-friendly short to moderately long term loans which provide security to the customer. It takes care of long-term needs of the customer and helps him to improve his credit score. Every time, you pay off your monthly bill, a report is filed with a credit reporting agency in Canada and this helps to significantly improve it, if you don’t default on payments.
You can also use flex loans for consolidating and paying off other loans that you have accrued. You can borrow a flex loan online or visit one of the stores in 62 locations across four provinces in Canada to apply for one. A soft credit check is conducted and the loan is sanctioned in most cases. It is completely hassle-free and you will be protected by Cashco’s client-first policy throughout the journey. You will also receive counseling and any legal help that you may require.
The company aims to provide financial service to the unbanked section of Canada by providing pawn loans. In addition to long-term flex loans, the company also provides single payment payday loans, auto loans and also pre-settlement funding to the needy.
Personal loans also provide a higher borrowing limit than payday loans because they are designed to take care of such financial needs that require bigger investment. The interest rate is usually lower than credit card rates as well.
How to pay off payday loans on time?
- Supplement your day income with additional incomes: If you think that you may fall short of meeting your financial obligation to pay off your payday loan or if you have been steadily building up a debt, you can explore the possibility of considering some income generating sources that pay you decent money quickly. Internet allows you to make quick money. You could work as a freelance writer, take online surveys, do product and app reviews, choose and use a search engine which pays you for using it, if you have a knack for art, you could sell your items on Etsy, sell your used items on Craiglist or in flea markets, work as a dog-walker, do baby-sitting, bartending or anything that suites you.
- Work out a settlement plan: Most scrupulous lenders have a hardship program for such clients who find themselves in troubled waters through no fault of their own. For example, if you get laid off without any prior notice after you have taken a payday loan, the lender may be willing to let your off by just collecting the principal or a smaller amount of interest. Sometimes, they will give you more time. But, it’s best not to rollover your debt again and again if you are not in a position to pay because it just adds up.
- Repay using your RRSP fund or your life insurance policy: It is just better to pay off your payday loan, however insignificant, rather than letting it build up. If needed, borrow money against your life insurance or registered retirement savings plan funds to pay off the loan first. If you pay before the payday loan builds up, you won’t have to lose too much on the maturity amount of your savings plans.