How to Manage or Get Rid of Payday Loans
Payday lending companies often charge in the hundreds of percentage points on payday loans to customers. Payday loans can be managed effectively---and gotten rid of altogether---if you can stick to a limited budget during the time in which you have the payday loan. Though you might want to seek other alternatives if you need money fast, such as a short-term loan from family, friends or a credit union or community bank, a payday loan can be helpful during times of emergency or if no other options exist.
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Instructions
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Calculate how much money you'll receive during the next pay periods until the payday loan becomes due. Many payday loans are granted for 14 days, on average. This means you'll have two pay periods if you get paid weekly and one pay period if you get paid every other week.
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Calculate food, transportation, medical and other essential expenses for which you'll have to pay during the payday loan period. Do not include items like fast-food, convenience store sandwiches or snacks, and other similar items you can do without during the payday loan period. Subtract this amount from your total income sources and use the resulting dollar amount as a reference for the amount of a payday loan you can afford.
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Sign a payday loan promissory note for only the amount of money you can afford based on your paycheck totals. Do not sign a loan agreement for a loan amount over and above the amount of money you'll earn during the next pay periods. For example, do not sign a promissory note for any more than $600 if you'll only earn this amount---or a little more---within the two-week payday loan period.
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Refrain from making any and all non-essential purchases during the payday loan period. Cut back spending on your weekly grocery bill; only purchase items that you need. Shop for meal items that can be purchased and made inexpensively, such as pasta, soup, eggs and pre-packaged meals. Find and use manufacturers' or store coupons to buy items at a lesser price. Do not spend money on items for entertainment purposes which you can do without, such as magazines, movies and books.
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Pay the loan back in full on its due date. Refrain from taking out another payday loan at another payday lender to cover the cost of the current loan you now have. Also, refrain from "rolling over" the current payday loan as this can increase the total amount due.
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Tips & Warnings
Ask for extra hours at work or offer to do odd-jobs for family and friends to earn a little more spending money in your next paycheck.
Call your payday lender immediately -- before the due date -- if you know that you are going to be late paying the loan.
