There’s two main ways payday loan consolidation works:
1. They negotiate your existing debt
Some loan that is payday consolidation organizations negotiate the total amount on the payday advances with your overall lenders. The consolidation company you’re working with aims to get your total balance reduced, sometimes by examining your loans carefully to determine if the interest rate you’re being charged is legal during this process. The consolidation company generally arranges a repayment plan which allows one to make one lump sum payment per month to get towards trying to repay the negotiated debts. This method frequently involves debt settlement that is payday.
2. They provide you with a loan that is new that might have a lower life expectancy rate of interest
Some cash advance consolidation organizations present a fresh loan to cover straight right back existing cash advance debts. Often, this will mean spending the total amount in full вЂ“ but under various payment terms.