What to do if you can’t meet your 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 an additional monthly expense. 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.
Sure, a bad credit loan might then be taken out to cover the additional costs, but this will not solve the problem and if the funds aren’t regularly available to make monthly repayments, the balance is likely to increase.
The reality is that sometimes borrowers can’t make their agreed repayments on time. The good news is that there are some steps that can be taken in order to reduce the risk of negatively harming your credit file. Or, even incurring additional charges if you know that you can’t make your repayments in time.
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 so this well in advance of the payment date. 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.
Loan Bird isn’t a direct provider. We simply offer loans between different lenders. You’ll need to get the contact details directly from the company that you borrowed from.
Seek financial advice
There are plenty of services and organisations in the UK that are designed to help people out in difficult situations. They may be able to provide you with financial advice, or put you into contact with relevant debt management companies that can provide with realistic debt exit strategies.
Financial advisors may be able to help you budget, or make you aware of ways to save money and cut costs that you might not have otherwise known about.
One service that might be beneficial is the Citizens Advice Bureau – you can find 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 consider all of your options and seek financial advice if possible.
A consolidation can be helpful because it can allow you to condense every smaller loan repayment you make into one larger monthly payment. This will make it easier to track your outgoings each month, 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.
Similarly, the consolidation loan might include longer repayment terms, further reducing the monthly cost (over a longer period of time).
Making informed financial decisions is crucial to maintaining cash flow and keeping your accounts in the clear. Don’t worry if your financial circumstances have changed, just get in touch with the payday provider ASAP to see what options are available.
We know how important it is to make the most of your interest, which is why our FREE service combines the best interest rates and deals across a huge variety of lenders.
If you have just been hit with an unexpected bill, and you know you only need a short time to get the funds available, why not consider taking out a payday loan through Loan Bird?
The application is quick and easy, with no obligation to continue.