Payday loans , although appealing at first, may soon get struck around your neck like a burden. A payday loan has a very high rate of interest and if you fail to off the loan at the expected time which is usually the next payday or a date fixed by the lender, you would have to pay a late fine as well as your interest gets compounded. If this continues, you may have to end up paying an APR as high as 400%!

It is better to take personal installment loans or term loans instead because they have much lower rates of interest and you won't have to offer any collateral to secure the loan. It is flexible, gives you a longer tenure to settle the loan and some of these loans can be used to consolidate your debt into one loan. If you are thinking of a loan which provides all these benefits and more, a Flex Loan from Cashco Financial is your best answer because flex loans are very consumer friendly.

Flex Loans from Cashco Financial

Flex loans are awesome because they allow you to get out of your debt trap. You can apply for one and get one sanctioned even if you don't have the best credit score or credit history. Your total debt service ratio is verified along with credit history but even for those with below average records, loans are usually approved with imposed conditions. However, since Cashco Financial is one of the few lenders in Canada which regularly reports your payment history to Credit Reporting Agencies, your credit score keeps on improving over time.

Under this scheme, you can borrow up to $5000 and choose a tenor which goes up to 36 months. The terms of the loan can be personalized on a case by case basis also. You can use this to consolidate your other debts and if needed, this loan can be rolled over.

Best ways to get out of a payday loan trap

1. Take a long term loan which can be used to consolidate your payday loan debt: Sometimes the same lender or a different lender allows you to take a long-term personal loan even if you have payday loan debt and this can be used to pay off your payday loan as well as other debts. The biggest advantage is that since this is a long-term loan, the rate of interest is usually much lower and since the high interest loans are paid off in full, your APR drops drastically, bringing down your overall debt.

2. Work out a settlement plan: Many lenders, if they sense discomfort or inability on part of their client to settle a payday loan especially when there is a genuine reason like loss of job or accident, may be willing to come to the table and strike a deal under which the client only has to pay back the principal only or principal and a small portion of the interest. They genuinely want to end your ordeal and maintain good relations with you.

3. Look for additional income: Sometimes, a supplementary income can boost your total monthly earnings and help you to deal with your debt better. There are a number of jobs which can be pursued over and above your day job as these don't require too many time or labor involvement and pays well. Look for jobs online or be a part of social or medical experiments that pay.

4. Don't rollover your debt: Stop rolling over your payday loan again and again. This leads to a situation where the interest becomes more than the principal. Take a long term loan instead and settle this one.

5. Withdraw continuous payment authority: If you are come under undue financial duress due to your mounting debts, you can instruct your bank to withdraw continuous payment authority that allows your lender to automatically withdraw a portion of your money recurrently. But, payday loan is a non-priority loan and if it leads to a condition, where you don't have enough money to take care of your utility bills, stop paying. There are enough laws in Canada to protect your interests in such a situation. Inform your lender through a formal letter also.

Conclusion

Don't let your debt situation get out of your hand. Don't borrow inconsiderately. Try to pay off your debts in small amounts regularly so that the interest doesn't mount up. All this will keep you safe from the clutches of debt collection agencies and legal woes.