By 
If you are one of the millions of Americans drowning in payday loan debt, you’ve likely already considered seeking help from a consolidation company. You’ve done all the work you had to do to take advantage of your payday lenders – you’ve done your research online to find a good and reliable company, completed all the paperwork, and finally you’re ready to regain control of your finances. Then all of a sudden your lenders tell you something that stops you in your tracks. A simple statement that can make anyone in debt feel completely desperate: “We do NOT work with consolidation companies.”
Is this true? If payday lenders don’t work with consolidation companies, why do they exist? These are the top three reasons your lenders will eventually work with your consolidation company.
1. Before enrolling in a debt relief program, the first thing that payday loan consolidation companies will recommend is to close the bank account that your lenders have access to. Although consolidation companies send legal documents to your payday lenders to revoke your authorization to automatically debit your bank account, it is necessary for you to close your bank account to ensure that there are no unauthorized charges coming out of your account.
2. Your payday loan consolidation company will also send legal documents to your payday lenders to stop and stop contacting you. According to the Federal Trade Commission, lenders must follow certain rules and regulations when collecting debts. If your payday lenders don’t follow these rules and continue to make harassing phone calls, your lenders can be fined $ 1,000 for EVERY phone call they make. Since most loans are for small amounts (between $ 200 and $ 1,000), calling it out becomes a risk that is simply not worth taking.
3. Many fear being sued if they don’t pay off their payday loans. Most borrowers are unaware that most payday lenders (especially Internet-based ones) are not licensed to lend money to people who reside in the United States. This means that payday lenders do not have the ability to take non-paying clients to small claims court for a payday loan. Payday lenders often use this tactic to scare borrowers into paying them, and it is effective because most clients are not well informed about what lenders can and cannot do.
Now, sit back and think about this for a moment: your payday lenders can’t debit your bank account for payment, they can’t call you for money, and they can’t sue you for the unpaid loan. How else will they be paid? Who else can they turn to? There is only one answer: payday loan consolidation companies.
So why would your payday lenders deny working with consolidation companies in the first place? It’s simple. People who sign up for consolidation companies obviously have multiple payday loans. In fact, people who get drowned in payday loans typically have between two and twenty payday loans. Consolidation companies generally work from one lender to another, which means that if you are a payday lender, you would not be sure when they would pay you. Payday lenders are aware of this and know that they are likely to be paid faster if there is no third party involved. For this reason, they claim that they do not work with payday loan consolidation companies, although they will eventually.
Don’t let your payday lenders intimidate you until you have all the facts. If you’ve tried everything you can to get out of payday loan debt but haven’t been able to, it may be time to seek professional help. After all, who wouldn’t benefit from a little help from time to time?