Struggling to repay your loans? Wondering how to get out of debt fast? It is possible, if you do it right. Join Quick Loans Express an instant payday loans provider, as we explore how to get out of debt fast- the wrong way and the right way.
Mounting payday loan debt can make borrowers feel overwhelmed and desperate. It is important to know that you are not alone and there are solutions. However, it is essential not fall into the trap of taking “easy shortcuts” out of debt. In the long term, these can just be more damaging.
In this article about how to get out of debt fast, we shall examine:
You can clear yourself of payday loans
How to Get out of Debt Fast-The Right Way
According to debt charities, more people than ever are requesting help to get their finances back in order. One charity, StepChange, estimates that 2.9 million people in the UK are in serious financial debt. Furthermore, 9 million are struggling to keep on top of their financial commitments, and there are hotspots of chronic borrowing around the UK. It is tempting to try and take a shortcut out of owing money by choosing an easier path. Unfortunately, these usually lead people into further financial trouble. Here are a few ways that people believe will solve their problems but in reality usually cause them more damage.
Unsuitable Debt Consolidation Loans
Debt consolidation loans often look great on paper, but in reality, are unsuitable for many people struggling financially. This type of loan is when you borrow a large sum of money to pay off a bunch of smaller commitments. Practically, the idea is to consolidate all your repayments into a single one to the new lender.
The drawbacks? First of all, the fees for these loans are usually very high. Also, many lenders like to take the person’s home as security on the loan. These kinds of loans are also known as ‘homeowner loans’. Should a person be unable to make their loan repayments, they risk losing their home.
Taking out one of these loans is a huge risk and needs careful consideration in case the borrower’s circumstances change. Furthermore, this kind of loan would be a bad idea if:
- The new repayments would be unmanageable.
- The sum you can borrow won’t cover all your other debts
- If your new monthly repayment would be higher than your current payments
- When a financial advisor could negotiate a better repayment plan with creditors
Television Advertisements: “How to Get out of Debt Fast”
Some companies will help people with their money issues by advising them to take the quickest way out of debt. This is their job, and they charge high fees for their services. Although their advice might lower your monthly repayments, it may not always be the best course of action to take. In fact, it could end up costing you far more in the long run. Instead, choose to speak to an independent debt charity who can give you free, unbiased financial advice. Click here for debt advice charities who offer free financial counselling.
- Millions of people in the UK are in serious debt
- Easy solutions are not always the best in many cases
- Debt consolidation loans can sometimes work out costing more money
- One’s home could easily be lost if it were put up for security and repayments could not be met
- Do not pay companies for the wrong advice when there are free debt charities who can help
Ignoring creditors attempts to contact you can make things worse
When someone is struggling with pressing financial commitments, they can be tempted to ignore their creditors. However, disregarding creditors’ correspondences might mean missing important notices.Unfortunatley, this can cause you even more problems. Some of these could include:
- Creditirs passing your case to a debt collecting agency
- Default notices
- Court action being taken against you
- A statutory demand, which is the first move by a creditor to bankrupt you
Most of these correspondences have deadlines that can cause you serious problems if you don’t reply on time. Speak to your creditors, or enlist the help of a financial charity who may be able to speak on your behalf.
Avoid debt wiping companies
Some companies advertise on television, promising to eliminate your debts entirely. If this sounds too good to be true, you’re right- in the majority of cases, it is. Sadly, many people who have used these services have received unhelpful and even damaging advice. As a result, many such companies have since been shut down. These companies charge fees for their services, and will usually advise an individual voluntary arrangement (IVA) or assisted bankruptcy. Sometimes, it is possible to find financial loopholes to help clear certain commitments. However, these kinds of laws usually only apply to a tiny percentage of people in debt.
People do not always know what is best for them
We would all like to think that we can decide the best way to handle our personal finance. Unfortunately, when trying to manage significant debt, this is often not the case. People’s emotions and fears can cloud their judgement and lead them to make mistakes due to their lack of knowledge. It is important to handle your finances independently; however, when a person is in trouble, a knowledgable financial expert from an independent debt advice charity can provide helpful monetary advice. They may offer solutions that you may not have considered on your own.
Bankruptcy Can Have a Long-Lasting Impact
When people have debts that they cannot repay, one of their options is bankruptcy. Apart from declaring bankruptcy themselves, if you owe a creditor over £5,000, they can declare you bankrupt without your consent. Your debts will go away, but you will have to pay a high price. This kind of decision requires a lot of thought. You need to weigh up how bankruptcy will impact every area of your life. Will you be able to cope with the ramifications of your actions? Some things that will be affected are a person’s pensions, housing, employment, credit rating and loss of current assets, as well as potentially their reputation and health.
How to Get out of Debt Fast- Proceed with Caution
The best way to get out of payday loan debt is to seek free advice from money charities, which employ financial experts on money management. They can offer tailor-made, impartial financial counselling for each person’s individual needs. Paying for unhelpful advice can only add to people’s debt problems. Furthermore, borrowing fast loans to pay off your commitments is very dangerous and should be avoided. Quick Loans Express give tips to help you avoid borrowing credit and solve your payday loan debt problems.