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Punishment for not Paying a Payday Loan




Pay day loans are categorised in the financial market as an unprotected loan. To follow the type of short term loans, they demand higher interest rates. To justify the high rates, debtors receive the convenience of quick access to cash. Borrowers do not have to provide their credit file, and pay day loan companies shall not look into your credit score. Unlike unsecured loans offered by lenders, there is no need to pledge any property as guarantee to get a payday loan.

Payday loans aren't long-term fixes to your financial problem. If you apply for a payday loan thinking that you can rely upon it to resolve your long-term problem, you may be in deeper debt than before. Thus, it's important to pay off your pay day loan as as is possible soon, since there is no real way of escaping this kind of loan. If you are not able to pay off your loan, you must make to face the consequences.

Here are some of the results for ignoring your pay day loan:

Overdraft Charges - Banks can levy high overdraft charges and penalties if your profile has insufficient funds which triggered your check to jump.

Charges from Lender - The payday advance company can require you to pay penalties predicated on the stipulation of your contract.

Humiliation and Harassment from Collection Agencies - In case your unpaid loan is referred to a series company, you might be subject to frequent humiliation and ignominy among your peers and the community. They have the liberty of contacting you multiple times including dialling your home, work place, or any other number.

Threat - Debt collectors also employ emotional abuse with intimidating message or calls.

Marred Credit Rating - Non-repayment of payday loans can be reported by the lender to the three credit reporting agencies in america, causing severe damage to your credit history. In addition, by enough time you choose to pay off your loans, lenders seldom report the repayment to credit reporting agencies. Should this happen, it will be hard that you can qualify for other loans.

Legal Action - Your payday lender has the right to choose legal action under the court of law for writing bad checks. If you're proven by the court guilty of writing bad assessments, you can spend unneeded money and time. You must also shoulder lawyer fees, which is much bigger than your original repayment amount.