It can be challenging to get yourself out of the trap of payday loan debt. The more debts you have, the more difficult it gets to break free. Your cash flow gets drained in the process, making it impossible to afford your living expenses and other loans.
Taking different types of payday loans can be a clear indication of serious financial distress. It might be time to look for help from Encompass Recovery Group if you don’t have the required resources needed to repay your payday loans and if you cannot consolidate your payday loans through a credit union or a bank.
How To Consolidate Your Payday Loans Using Consumer Proposals
A consumer proposal is an agreement between a borrower and unsecured creditors to pay back a certain percentage of the debts over a number of years. This contract is legally binding, and there are consequences of failing to adhere to its terms and agreement.
Eligibility of Consumer Proposal
After successful completion of the proposal, a borrower is relieved from the debt stress since they can pay off their debts according to the agreed plan. By law, the unsecured creditors will have to stop the following: charging unreasonably high interest, taking legal action on you, and collection calls.
However, you will be required to remit regular monthly payments to the trustees, who will then disburse it to your unsecured creditors. The payments are usually lower than what you have been paying on your other debts.
Several payday loans are incorporated into a consumer proposal. Payday loans are unsecured personal debts. Other forms of unsecured loans include utility bills, credit cards, and CRA taxes, among many others.
Your trustee is required to guide you through the whole process as some types of unsecured loans such as court fines, fraudulent loans, and child support cannot be included in a proposal. Secured loans such as mortgages are excluded. However, loans that are eligible for inclusion must be part of the consumer proposal.
How to Find Out if You Qualify for a Consumer Proposal
If you are in a poor financial position and unable to repay your loans, you should look for help. A detailed review of your finances by a licensed professional will be conducted during your consultation. All possible options of getting you out of payday loans will be reviewed. Consolidating payday loans will help you get back on track. You will regain your financial position in the long run.
The Process of Consolidating Your Payday Loans with Consumer Proposal
Providing Your Debt Details
A sign-up form for most legitimate consolidation companies is available on their websites. You are required to fill in your real debt information there; it may include your name, email address, phone number, type of debt, the state where you are, and the full debt amount.
Get a Free Consultation
The consolidation company should contact you within 24 hours after the application. They will discuss with you in detail regarding your loans. They will check the state’s laws, your interest rates will be calculated, and an evaluation of your monthly income to provide the ideal debt assistance for your payday loan.
Consolidating Payday Loans
After the free evaluation of your financial position, the consolidation company proposes methods to end automatic debits from your checking accounts. They negotiate with the lenders for an affordable repayment method and in this case, if your only available option is a consumer proposal, you will be guided through the process of getting one. Your many small loans are then merged into one for easy and efficient payment.
Take Control of Your Payday Loan Debt Today
Struggling with payday loans can feel overwhelming, but there is a way forward. A consumer proposal can help you reduce your debt, lower your payments, and break free from the payday loan cycle—all while protecting you from collection calls and legal action.
At Encompass Recovery Group, we work with borrowers to explore the best solutions for their financial situation. Whether you’re considering a consumer proposal, debt consolidation, or alternative repayment plans, our experts are here to guide you every step of the way.
Take the first step toward financial freedom today. Contact us today to discuss your options and start rebuilding your financial future.