In the current economic climate money is tight, inflation has hit us again, and it is becoming more difficult to make ends meet. If you have experienced any money problems over the past few years, then it is likely that you have taken out a loan of some kind.
Loans can be a great resource for the public as they can help bail us out of financial problems. They can also help to put food on the table and deal with those pesky bills.
But it is important to remember that loans mean repayments. You might be finding it is tougher than you thought to make those repayments. This is particularly true of payday loans and short term loans. They tend to have a large percentage rate and often leave you out of pocket and having to pay back much more than you borrowed in the first place.
If you have debt problems it can adversely affect your credit score, making it harder to get a mortgage, buy a car or take out insurance
Luckily there are a few options open to you if you need help to repay your loan:
Contact Your Lender
Never ignore the fact that you can’t pay back your loan. In fact, this is the worst thing you can do and will often leave you worse off than you were before.
Contact your lender as many of them have repayment plans in place to help people who are struggling with money. In fact, many of them may be able to suspend the debt for an agreed period, as well as informing you of free and impartial advice services.
Individual Voluntary Arrangement (IVA)
An IVA arrangement is perhaps not the ideal option, and you should only consider it as a last resort to avoid bankruptcy.
The arrangement is a personal contractual agreement between you and your creditors, which is a flexible as you need it to be. Your level of capital or income, sometimes both, will often dictate the arrangement.
One of the main issues of an IVA is the length – it can often last several years.
Contact a Debt Resolution Company
Contacting a debt resolution company is another option open to you. Their job is to help and guide you through your debt problems, so you emerge debt free.
At a basic level, they will do everything they can to help you get out of debt.
Most debt resolution companies will deploy an attorney to mediate matters between you and the lenders. They will be responsible for negotiating with them on your behalf and helping get your debts under control.
Don’t ‘Roll Over’
Most loan companies will offer you the option to ‘roll over’ your loan. A ‘roll over’ option means that you are pushing your repayment back for another month.
If you are struggling to repay your loan then avoid this at all costs.
It sounds like a great idea, but can end up being worse. If you choose the ‘roll over’ option, you will incur further interest and charges and end up owing even more money.