A short-term cash advance can be a lifesaver when an unexpected financial emergency comes up. You can use it to repair your car, replace a broken appliance, pay for a medical treatment, or for any other unforeseen expenditure. But what happens if your financial crisis lasts longer than expected, and you realize the you're not going to be able to repay the cash advance on time? Don't panic – there are things that you can do to remedy the situation before it gets out of hand. Take a look at some tips that can help.
Request an Extended Payment Plan
The very first thing that you need to do is ask for an Extended Payment Plan (EPP). If your cash advance lender is a member of the Community Financial Services Association of America (CFSA), they probably offer the EPP as an option. An EPP gives you additional time – usually four additional pay periods – to pay off the loan with no extra charge.
It's important to act as soon as you realize that you won't be able to pay off the loan by its original due date. To qualify for an EPP, you must request it by the last day before the loan's due date, and before the close of business on that day. You'll have to sign an amendment to your original loan agreement, and your payment will be split into four equal payments – one for each pay period in the new loan timeframe.
Organize Your Bills
Over the next four pay periods, you're going to have to make room in your budget to take out those four payments. Splitting up your loan repayment should make that easier, but if you're truly strapped, you may still have trouble making the payments. It will be easier to find the money if you have your bills in order.
One thing that commonly trips people up is not really keeping track of which bill is due when. For example, imagine that your electric bill and water bill are both due in the same week that your second payday loan payment is due. If you have to pay those both in full from that paycheck, then you may not have enough left for the payday loan. But if you set half the rent and half the electric bill aside during the pay period when the first payday loan is due, you'll have the money left to pay both payday loans, because you'll only need to take the other half of the rent and electric from the paycheck that will cover the second payday loan payment.
You know that you'll have payday loan payments, so try to split the payments of your other bills up similarly to the best of your ability. If you're organized and know when everything is due, you'll be more able to set money aside before the bill is due.
Consolidate the Loan
If all else fails and you can't come up with the money to pay off the loan, you can try to consolidate the loan. It's not the best option, because you'll still have a debt to pay, but it's better than defaulting on the cash advance. Just remember that taking a loan to pay off a loan should always be a last resort.
There are a couple of ways to consolidate. You could pay the debt back with a credit card, if you have one available. You could also ask for a loan from your bank or financial institution. Or you could borrow the money from a friend or family member. In almost every scenario, the interest on the new loan should be lower than the interest on a payday loan.
A cash advance can be a wonderful help in an emergency, but it pays to consider how you're going to pay it back before you take out the loan. It's a good idea to have a contingency plan in place in case you can't pay it back as quickly as you anticipate. For more information, visit sites like http://www.usacashservices.com or contact a local payday loan company.
Three years ago, my husband and I started saving money for an extensive home renovation project. While we have been able to save a lot of cash over the last three years, we still don’t have enough money to pay for the upcoming remodeling project we plan to do at our home. Therefore, to raise the remaining funds needed, we are going to take out a home equity loan. If you need to do some home remodeling projects around your home, you should consider taking out a home equity loan. This type of loan can help you pay for important items such as new floors, a new roof, or new siding for your home. On this blog, you will discover the types of home equity loans offered at most lending institutions. Enjoy!