Posted on June 6, 2009 at 12:40 am Hi I am Newbie for this forum,I have one question about How do you consolidate payday loans?Give me some suggestion about my question.Thanks in Advance ...

Posted on June 6, 2009 at 1:01 pm Some people in your situation would take out a home equity loan to consolidate multiple payday loans. They take out a loan against the equity in their home, and as a result benefit from a single, lower monthly payment and often from a lower interest rate. I have heard that their are some risks associated with taking out a home equity loan but I am not to sure what is necessarily meant by that? I would assume that your home may be at risk if you can't pay off the loan.

Posted on June 6, 2009 at 5:32 pm Yes, taking out a home equity loan carries potential risks. The main problem of course is the fact that the person is turning unsecured debt into secured debt. As a result, if they were to ever miss payments they would in effect be putting their home at risk of foreclosure. Additionally, many unsecured consolidation loans have very high interest rates since no collateral is attached to the loan to secure the debt. Many people who take out these loans end up paying back a lot more than what they owed on their credit cards.

Posted on June 7, 2009 at 12:55 am There are some debt settlement companies that accept payday loans from what I understand, but the savings realized is very small because by the time funds have accumulated, the balance has already quadrupled due to the high interest.  The other problem with payday loans is the other options for debt consolidation that could probably help require good credit.  Many people, therefore, won't be able to use them, as payday loan users typically either have poor credit history or lack a credit history altogether.  That said, the best option is to try to transfer the balance on a 0% interest credit card or trying to get a low interest personal loan from your bank or credit union.  

Posted on June 7, 2009 at 10:08 pm jhones.hamilton, it depends on a lot of factors. First is how much you really owe. If it's just a few hundred dollars, it wouldn't really be necessary to consolidate. Also if you own a home, just to echo what was mentioned earlier, one option is to take a home equity loan to pay off your debts. Take note that some debt consolidation firms opt not to consolidated defaulted payday loans. If you decide to take the route of credit counseling, it would be best to confirm this with the company you'd like to work with.Good luck.

Posted on June 7, 2009 at 10:20 pm Hello All Thanks For sharing your opinion here ...