Have you had a payday loan that was due and you just couldn’t afford to pay it? The temptation is to take out another payday loan to get by. This is considered stock piling payday loans and it is very dangerous for your financial stability. A couple rules of thumb to follow should be to:
Never have more than one payday loan open at a time.
And always make sure you can pay it back on the specified date.
There are some people that obtain payday loans from more than one company at a time. These people make it hard on themselves by juggling and number of payday loans. Most lenders have appropriate means of checking how many loans a person has active. TeleTrack and CLVerify are two methods lenders use to pull up information about a potential customer. If records indicate a history of poor payday loan practices, the loan gets denied.
Most payday loan lenders require the viewing of a recent bank statement before approving a loan. This process is a way to help determine if a person is stock piling payday loans. In black and white, it allows the lender to plainly see if any recent payday loans have been deposited.
If you run into a rut where you are paying one loan with another, you are creating a whirlpool effect that will drag you down. That is why it is essential to know exactly how much and when a loan payment will be due. If you question whether one payday loan will be enough, you should try to find another solution.
A payday loan should be a short term solution to your money problems. It should not be relied upon to get you out of debt. When applying for a loan you should think about how much money you will have after the loan is paid off. If you know that it will not be enough for daily expenses, then you probably can’t afford a loan of that amount; and you should consider taking out a smaller loan. Getting into a payday loan that you can’t afford could tempt you into getting another — starting that rollover effect costing you hundreds more than originally planned. If you simply must roll over a payday loan to another date, you should try to pay down the principal on top of paying the “required” fee. This will help make paying the loan more manageable on your next due date.
Payday loans work wonders for many people to help them attain the extra money they need. Payday loans can also be a large debt trap if not used properly. Always remember. It’s a sort term answer for emergency situations; you can’t live weekly on payday loans. If you’re circumstances require you to take out more loans to pay the ones already existing sit down and reevaluate your financial situation.
