- Finance

Protocols to Help Short-Term Loan Customers in Financial Trouble

If you have recently taken out a payday loan due to short-term financial issues that required a fast solution, you will have done so through a responsible payday loan lender in most likelihood. At the time of an agreement being made, you would have been checked rigorously and had the ability to pay back the debt within the agreed timeframe. Sometimes, however, there can be dramatic and immediate changes in circumstance that we just can’t foresee happening. In these situations it can be very stressful to think about how you are going to put food on the table, let alone how you are going to be able to make the agreed repayment in time.

A responsible lender will have put you through all of the necessary checks to ensure that a short-term loan is the right option for you. Prior to going to a short-term lender, it is important to look at all of your financial circumstances and work out ways in which you can pay for something. This could be to save over a period of time, cut back on expenses or lend the money from a trusted source, such as a friend or family member. If all of the other avenues are not open to you, and you have the ability next payday to make repayment on the loan, it could be the right option for you at the time. Applying for a loan to cover other debts might not be the most sensible option for you at this time, or it might be the best option to consolidate your debts into one manageable payment.

What happens though, if after going through the entire process, you lose your job before the next payment date, or suffer an injury that requires rehabilitation in the short-term, costing you time and money?

All debt problems can be resolved. The best thing to do is to face up to them as soon as possible, before they start to build a life of their own. The last thing you should do is to hide from it and hope that it will go away. Your short-term lender should help you with debt advice and links to other debt charities and debt problem services that can help you resolve your debt issues as soon as possible.

A responsible lender should provide you with access to a Forbearance team. This team will deal with you directly should you be in financial difficulty after taking out a loan from that company. They will deal with you on a personal and empathetic level, working out the steps needed to help you with your debt and new financial issues. Instead of the old response from payday loan lenders to maintain the addition of late payment fees and interest, some modern and responsible lenders will instead seek to freeze both and work out a new repayment plan, either immediately and of a lower nature, or after a short payment holiday. They will also endeavour not to put any additional pressure on you in the form of correspondence chasing payment, for a set period of time, and will also prevent you from applying for additional credit to cover the new debt.

With the right support and stringent protocols from a responsible lender you can still find the help you need, even if you have found new financial problems since agreeing to a payday loan.

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