Payday Loan Debt help and Consolidation

This may seem at first to be a convenient way of staying afloat, but very high interest rates will penalise you badly if you can’t pay off your payday loan.

Get help now

A fairly recent financial innovation, the ‘payday loan’ has over the past few years become increasingly sought by people who find themselves with too little money each month to cover their outgoings due to either low income or an unplanned expense.

Payday loan debt can be very difficult to manage if you don't repay in full as per the terms of your original agreement. This is because the representative APR of a payday loan can be relatively very high indeed so, if you don't repay your loan on time, interest charges can quickly turn what seemed to be a reasonable short-term solution into a level debt that can seem totally overwhelming.

Payday Loans For Bad Credit

In a financial environment that can be difficult to obtain credit, a payday loan might be seen as an easy solution to a short-term problem. That might well be true on a short-term basis, but payday loan debt can quickly become a big problem if it isn't paid off in full when you agreed to do so.

Payday loans were designed to be a short-term solution to address a short-term problem. In principle the product works like this; you borrow a relatively small amount, eg. £200, for a short amount of time, eg. 14 days. Then, when you've been paid by your employer, you repay the £200 with interest, which might be set at £20.

Some people might see a £20 charge as being an acceptable amount to pay in order to borrow that money. But the representative annual percentage rate (APR), which is a figure that allows you to compare the cost of loans and other credit, can be very high indeed when compared with other forms of credit. Whereas a credit card APR might typically be around 20%, a payday loan APR might well be over 1,000%.

Too Many Payday Loans?

But payday loan debt can easily spiral out of control if not paid back in time because without access to alternative means of credit, a debtor who defaults on a payday loan company often feels there is no other option but to take out other payday loans.

If several payday loans have been accumulated then payday debt consolidation might be attempted, which means one large payday loan is used to repay the others. This can bring short-term respite but if the underlying reasons for getting into debt aren't addressed then the debtor is likely to end up defaulting on the large payday loan repayment. If the debtor defaults on this repayment then the interest charge applied is likely to be very high indeed.

How Can Payplan Help With Payday Loan Debts?

If you're worried about your payday loan debt, then in the first instance contact Payplan for free debt advice. We can assess your income and expenditure and suggest ways you can improve your budgeting to maximise your income and minimise your expenditure.

As a Payplan client, you'd benefit from being able to let us speak to all your creditors on your behalf. Some people might feel this alone is enough to give them peace of mind. If a debt management plan is a suitable debt solution for you, we would ask all creditors to freeze interest charges and request that they accept a reduced monthly repayment that is based on what you can reasonably afford to repay.

Please note that your creditors are under no obligation to freeze interest and charges or accept reduced repayments, but Payplan have around twenty years of experience in dealing with creditors, and our methods of dealing with creditors are therefore well-established. We contact and deal with all our clients' unsecured creditors, and this saves you lots of time and hassle in terms of administration alone.

Payday Loan Help

As a next step, contact Payplan for free, sympathetic and immediate advice regarding advice with dealing with payday loan debt or payday debt consolidation. There may well be a number of debt solutions that are appropriate to your needs and we will explain all your options impartially. Telephone free on 0800 280 2816 or use our debt help form, and your free debt help can begin as soon as you contact us.

Unlike so many other debt management companies, Payplan's Individual Voluntary Arrangement and Debt Management Plan debt solutions are free to our clients, which can mean lower repayments for you. With a Payplan free to client debt solution, all of your repayment goes towards paying back your debt.

Help with payday loan debts

Payplan provides expert, impartial & confidential advice & debt solutions that are FREE to our clients.

Get help now

find a suitable debt solution in 10 minutes or less, try our brand new anonymous online debt tool now.

Start Plan Finder  
Free debt advice guide

Take a step towards freeing yourself from debt by downloading our PDF guide.

  1. Yes No
In debt?

You’re not alone our UK Debt Map shows you why!

Example Plan

Debt: £10,400
Creditors: 3
Was paying: £437 per month
Now paying: £250 per month

In this typical example, we arranged a DMP for our client who was struggling to repay his debts. His payments are now much more affordable!

Read more  
Together we'll help you regain control

Payplan provides support that really can get you debt-free.

Call us free on
0800 280 2816

Enquire now  
Back to top