Since the beginning of payday lenders there has been quite a few payday loan consolidation companies jumping on the bandwagon. But not all consolidation companies operate the same way.
Payday loan consolidation works in essence by taking your total debt owed and coming up with an affordable monthly or bi weekly repayment schedule and will pay off your debt in that time frame agreed upon. Based on my research some companies treat payday loan consolidation like a debt settlement model. This means when you make your monthly or bi weekly payments the company may hold onto these payments for a period of 2 or 3 months then try to approach the payday lender to negotiate a pay off. This type of model is bad for two reasons:
Quick Cash Loan
These payday lenders are very aggressive in their collection efforts and if they don't hear from you (the client) in a reasonable time frame they will call your cell, home, your work and your references constantly.
Also this puts the payday lender in a defensive posture and will be less willing to work with your consolidation company to set up a re-payment structure.
Some companies will take your payments for the first few months and all that money you pay goes towards their fees first, then the lenders start to see the money. As well if you have storefront loans and they loaned you a certain sum of money why would they be willing to accept less from you? That doesn't make good business sense.
When you have numerous payday lenders it is important to keep them from constantly calling and harassing you when you are part of a program which is going to help you out of this type of debt. People are dealing with so much stress as it is and if it can be kept to a low level or eliminated completely that is the best.
Solid and professional payday loan companies are pro active and aggressive in their approach with the lenders. This means once the clients start to make their payments the company will have already negotiated a re-payment schedule with the payday lenders based upon the amount they will be receiving from the client. This will obviously make the lenders more likely work with the payday loan consolidation companies.
It is imperative that you perform thorough research when talking to payday loan consolidation companies this way you know you are getting the best value for your money.
Payday Loan Consolidation Companies, They Are Not All The Same
See more : online payday loans no faxing