Are those payday loan debts accruing? Perhaps your liabilities, consumer debts, and bills are piling up on your table from different creditors. This summer is the perfect time to consolidate your debts.
Payday loan consolidation might be your best bet at easing the burden of debts and providing a better channel for paying your debts. Combining all those payday loans into one personal loan is preferable to struggling to pay all differently.
This piece explores the benefits of payday loan consolidation and how it can be of great help in payday loan relief.
Personal Loans for Payday Loan Consolidation Offer Lower Annual Percentage Rates
Payday loans come with very high APRs, some even reaching an outrageous 300%. And accumulating several of them would have some disastrous effects.
However, personal loans have lower APRs that fall in the range of 20% to 35%. This is much lower than the APRs of payday loans. This shows that payday loan consolidation will be a great help with payday loans.
It Simplifies Your Finances
Accumulating several payday loan debts from different sources and trying to pay them all simultaneously would certainly prove difficult.
Acquiring a personal loan to consolidate all your payday loan debts will simplify your finances. First, you pay off all your payday loan debts with such a personal loan. Then you now pay off the personal loan in monthly installments at lower interest rates.
Such an approach is the wiser alternative and it would bring a lot of payday loan relief.
It Can Improve Your Credit Score
Having a high credit score has several benefits. These include lower interest rates on loans and credit cards, better insurance rates, and all that.
Accumulating several payday loan debts will have an injurious effect on your credit score. It could push your score down from good or excellent on FICO to fair or even bad.
Payday loan consolidation offers you a way out. It improves your credit score by reducing your credit utilization rate. Credit utilization rate is an important factor in determining your credit score. A low credit utilization rate equals a high credit score.
So consolidating your payday loans will help you pay them easily. You pay them at a lower interest rate and this gives your credit score some boost.
Shorter Repayment Time
Payday loan consolidation is your ticket to being debt-free in a shorter time if you have many payday loan debts. You might ask how this can come to be.
People take payday loans due to the ease of acquiring them though they have high-interest rates. And some individuals usually expect to pay them off in the shortest time possible.
But taking many of them and not being able to pay them off at once means paying off some and leaving others unpaid. The interest in these unpaid ones begins to build up. In the end, one finds that one paid so much more than what one borrowed.
But taking a personal loan ensures you pay these loans at once. Then the terms of a personal loan are easier to deal with than payday loan terms. This makes for a shorter repayment time.
Conclusion
Payday loan relief is within your reach through payday loan consolidation. It is a great help with payday loans and would make all those payday loan debts disappear soon.
