What to Do if You Can’t Meet Monthly Repayments
It’s not unheard of for somebody’s financial situation to unexpectedly or abruptly change – this can go in either one of two ways. A surplus of cash that can be used to invest in their future. Or an unanticipated deficit that might leave them struggling throughout the month.
Whilst we don’t like to think about it, there are certain situations in which someone might, for example, lose their primary source of income or acquire additional monthly expenses. If this is unplanned, it can be difficult to adjust. This could then lead to difficult cut-backs or missed payments on any finance agreements or loans.
Whilst payday loans can be a great way to quickly help out in a pinch, they’re not designed to be sustainable, long-term lending solutions. A payday loan should only ever be taken out if the borrower knows that they can make the full payment within the agreed timescale. Otherwise, it will lead to additional charges and interest, potentially exasperating the already difficult situation.
If you can’t get a payday loan due to bad credit, you could look at a bad credit loan and use this to cover the additional costs, but again, this may not solve the problem if you’re not thinking of using it as a short-term fix.
The good news is – there are some steps you can take in order to reduce the risk of harming your credit file. Furthermore, these steps can help prevent incurring any additional charges.
Tell the Lender
If you know that at any point you won’t be able to pay your monthly bill, you absolutely must let the lender know. If you can, do this well in advance of the payment date that’s due. It’s not guaranteed, but many lenders may let you push back the due date or even extend the total loan agreement length. This will allow you to make lower payments over a longer period of time.
Each lender will follow different processes and some may be more lenient than others. The best thing to do is just contact them directly and see if there is anything they can do to help you out.
To note – LoanBird isn’t a direct loan provider, we simply offer loans from a large amount of the UK’s lenders. If you’re reading this on the back of borrowing money through us, you’ll need to gather the contact details from the lender that supplied you your loan.
Seek financial advice
There are plenty of services and organisations in the UK that are designed to help people out in difficult situations. They are able to provide you with financial advice, and could even put you in contact with reputable debt management companies that can provide realistic debt exit strategies.
Dependent on your circumstances, a financial advisor/friend may be able to help you work out a budget. The money saving expert website is full of info and ways to save money/cut costs that you might not have otherwise known about.
One service that might be beneficial is the Citizens Advice Bureau – you can find all their contact information online.
Consolidate your debts
We know that it might seem impractical to take on more debt in order to clear your existing balances. If you are considering a consolidation, we strongly advise you to study all of your options and seek financial advice if possible.
A consolidation loan can be helpful because it can allow you to condense all smaller loan repayments you make into one larger monthly payment. This will make it simpler for you to track your outgoings each month, also making it much easier to know when you have extra money.
Consolidating your debt can actually reduce your monthly repayments, too. Rather than paying varying interest rates on your existing loans, you will be paying one flat rate for the total outstanding amount. This doesn’t always work out to be cheaper, but in some cases, it can allow you to save a considerable amount of money.
Consolidation loans normally include longer repayment terms, this reduces the monthly cost to you giving you more available cash. Again, study this option carefully by crunching the numbers to make sure it fits best practice.
We know how important it is to get the best interest you can on a loan, which is why we offer a FREE service that scours interest rates and deals across a huge variety of lenders.
Ever considered taking out a quick loan through LoanBird? If you can’t pay those monthly repayments or have just been hit with an unexpected bill, we have loan options available to suit long-term or short-term circumstances.