Payday Loan consolidation involves swapping multiple payday loans for a single, longer-term debt with a lower interest rate. This can help break the cycle of debt that keeps people paying fees on top of existing payday loan balances. This strategy can also help diversify your credit mix, which is important for building your payment history — the largest factor in credit scoring. Check this out:https://www.nationalpaydayrelief.com/payday-loan-consolidation/
Credit unions, online lenders and banks all offer personal loans that can be used to consolidate payday debt. Most of these loans will require a credit check, which can cause a short-term dip in your credit score. However, long term, the benefits of payday loan debt consolidation could make it worth the temporary hit to your credit.
Payday Loan Consolidation vs. Debt Settlement: Which is Right for You
If you’re drowning in payday debt, these five options for payday loan consolidation can provide life preservers. They can help you escape the debt trap that keeps you paying triple-digit interest rates, as well as save money and rebuild your credit.
A credit card debt management plan (DMP) is generally used to help people eliminate credit card debt, but it can work just as well to reduce payday loan balances. With a DMP, you work with a credit counselor to create a payment plan and negotiate with creditors on your behalf. You send funds to the credit counseling agency on a monthly basis, which they then use to pay your creditors. If you’re considering a DMP, be sure to research your options carefully and only choose one with a legitimate credit-building track record.
