What would you do if you needed a short-term loan, but all you could find were payday loan scams? Payday loans have a reputation for being punitive and laden with fees, but many borrowers don’t know their rights. It’s tough finding legal advice, specifically on payday loan debt.
While consumers’ frustration with payday loans is understandable, it can drive them into the arms of predatory lenders. If you’re considering a payday loan, or are facing charges because of one, call Kurland Law Group to speak with one of our Maryland Payday Loan Attorneys. We can help!
A payday loan is a small, short-term loan usually due on the borrower’s next payday, usually two weeks later. They are known for having high-interest rates, and many states have laws against them.
If a borrower doesn’t pay back a payday loan, the lender can do what any other creditor can: call, write, sue, and take money from wages and bank accounts.
Payday loans are often called “traps” because if a borrower can’t pay back the loan when it’s due, he can pay a fee to keep it going until his next payday. Many people who borrow money pay the interest every two weeks, but they don’t pay off the loan’s principal.
Typically, payday loans are easy transactions, but failure to repay the loan by the due date might result in a legal dispute. Typical payday loan-related legal problems include:
There are alternatives to payday loans that might provide debt relief. Community organizations, churches, and private charities are the most accessible options.
Payment advance: Many employers allow workers to receive money earned before their paycheck is due. For instance, if an employee has worked seven days and his or her next regular payment is not due for five days, the employer might pay the employee for the seven days worked. There is no borrowing involved. It will be deducted from the next pay period.
Debt management plans: Nonprofit credit counseling firms can provide a monthly fee-based service to minimize credit card debt through debt management plans. The creditor offers the agency a cheaper interest rate, and you may decide whether to take it. The agency pays the creditors, and you make a single monthly payment to the agency, freeing up funds for bill payments and debt reduction. The strategy repays the loan in three to five years.
Credit Counseling: Nonprofit credit counseling institutions provide free assistance in creating a manageable monthly budget and reducing debt. Credit counselors may lead you to local organizations that provide aid with food, clothes, rent, and utility bills to support individuals through a financial crisis.
Debt Settlement: When attempting to keep up with unsecured debt (credit cards, medical bills, personal loans) is the cause of your constant lack of funds, you might select debt settlement as a kind of debt relief. Debt settlement agrees to pay less than what you owe, but it significantly impacts your credit score and report.
Borrow from friends or family: Borrowing money from family or friends is frequently the quickest and least costly option to get out of a jam. You would expect to pay a lower interest rate and have more time than two weeks to repay a loan, but make sure this is a mutually beneficial business transaction. Create an agreement that specifies the conditions of the loan. And adhere to it.
Community banks and credit unions: The laws allow community banks and credit unions to provide smaller loans with more accommodating payback conditions than major regional and national banks.
Local charities and churches: There are many local organizations and churches eager to provide free support if you have encountered difficulty.
Both Chapter 7 and Chapter 13 bankruptcy consider payday loans unsecured debt. In other words, these types of debts are often eligible for discharge or inclusion in a payment plan. However, it depends on the sort of bankruptcy you declare and your eligibility.
In most cases, Chapter 7 bankruptcy cancels the unsecured debt, such as payday loans. In Chapter 13 bankruptcy, your payday loan debt and other obligations are restructured into a three- to five-year repayment plan. In this type of bankruptcy, you may be required to repay just a percentage of the whole loan amount.
Before taking out a payday loan, it is good to weigh all of your alternatives. A payday loan lawyer may be helpful if you have trouble paying back a payday loan or are having problems with creditors. Your lawyer can explain your legal rights and represent you in court if needed.
The most significant advantage of consulting with a payday loan lawyer is negotiation assistance. Your attorney will examine your overall financial circumstances, including your present salary, to estimate the amount of debts you can repay. Then, they will negotiate with the creditors until a deal is reached, which often results in a substantial debt reduction. The decrease in financial stress alone justifies the engagement of a payday loan attorney.
If you do not engage an attorney, a lender may launch a lawsuit against you, which may be highly expensive. Sometimes, the legal costs you must pay for counsel will be far less than if you were to represent yourself. In addition, a payday loan attorney may be able to persuade the lender to arrange a settlement outside of court, allowing you to avoid legal procedures.
When a debt collector or lender learns that you have legal representation, they will likely lessen the frequency of their contact. They will be less aggressive even if they call since they know your lawyer is familiar with the laws. Your payday loan attorney will act as a buffer between you and debt collectors to assist you in responding appropriately to their calls.
Whether you’ve been the victim of a predatory payday loan, your bank account is being garnished, or an exorbitant overdraft fee has docked your wages, an attorney’s voice provides assistance. Kurkland Law Group has the experience needed to help you fight back and end these practices affecting citizens across the country.
The best payday loan attorneys in Maryland are on your side. We know the laws, we have years of experience, and we are on your side. Contact our Rockville law office today for a free consultation. We can help you resolve your payday loan issues.
Get the Help You Deserve. Contact Us Today