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Payday Loan Debt – 5 Problems And Solutions in California

Payday loans are an easy option to take out fast cash during any emergency. However, the faster cash disbursement makes the payday loans much lucrative even with having incessantly high-interest rates!

In California, many folks are falling prey to the loan sharks. And thereby making their financial lives miserable!

Here are a few cases in California that can provide you with some harsh truths about payday loans or pdls!

Let’s have a look at the scenarios along with suggestions about what you can do if you’re experiencing a similar one.

Scenario 1:

Hi! I am Nicholas and I stay in San Jose, California. I have taken out 2 payday loans, almost 6 months back; one from ACE Cash Express amounting $250 and another from Check Into Cash amounting $200.

I badly needed the money due to some emergency room visits. As I was in dire need of the money, I didn’t care about the APRs.

But after that, it has become quite cumbersome to pay off my payday loans due to the high APRs.

However, as I have given ACH authorization to my lenders, they have debited the amount from my account. I am really worried about the balance in my checking account.

So, is it possible to stop payday loan lenders from debiting his account?

Solution:

Hey Nicholas! You have the right to stop your payday lenders to electronically debit your account automatically! It doesn’t matter even if you have provided them ACH authorization.

Talk to your bank or credit union that you want to revoke the authorization you have granted. Have written communication and keep the documents so that you can produce it in the future if required. Or, you can even close your bank account as well!

However, you will still owe those payday loans. Revoking your ACH authorization won’t cancel your debts. And in the meantime, you will notice that your payday loans are piling up to an incessantly high amount.

So, it’s always better to look for effective ways to escape from the grasp of the payday loans and lead a debt-free life ahead.

Scenario 2:

I live in Oakland, California and I am looking for payday loans online. I have come across various payday lenders like Money Mart, Check Center, etc.

Now, I want to know which one will be the best company to take out a payday loan? And how are payday loans paid back?

Solution:

Hi! To find the best payday loan options for you, at first, check whether or not the lender is legal. In California, you can take out a payday loan up to $300. And the lenders can charge you a maximum fee of $45 for taking out a pdl.

However, the Annual Percentage Rate (APR) of payday loans in California is a whopping 372%!

The California Department of Business Oversight (DBO) regulates the payday lenders.

So, contact the DBO to check out the authenticity of a payday lender. If a payday lender is legal and the APR seems affordable, you can go ahead to take out a payday loan! But make sure you can pay off your payday loan on time!

But, make sure you have the affordability to repay it on time.

Secondly, as the name suggests, taking out a payday loan means you have to pay it off on your next payday!

While doing the paperwork, the lenders will take a check from you to cash it on your next payday!

So, if payment is not done on time, the lenders can cash your check. Otherwise, you can rollover your payday loans by paying certain charges!

However, that will increase your outstanding pdl debt amount quite a bit and you might have to take professional help to get rid of it.

Scenario 3:

My name is Joseph from Redlands, California and I am trapped with 4 payday loans of about $4,800. A substantial portion of my paycheck is going to repay my payday loans. As a result, my savings at the end of the month is almost nil!

I want to lead a debt-free life. But I am unable to find a way out from this debt trap! How can I get rid of payday loans faster?

Solution:

We all want to lead a debt-free life. But some immature decisions in our lives can lead us to fall prey to the debt trap. And a harsh fact of human life is that there is no undo option!

To get rid of payday loans faster, check for effective ways to pay it off! If you are exhausted with high APRs, opt for a payday loan debt consolidation program! It will help you to reduce the incessantly high APRs of payday loans!

And if you need some relief on your high outstanding balance, opt for a payday loan debt settlement program. Doing so, you can pay off your pdls with a much reduced amount!

Scenario 4:

I am Kelvin from San Francisco and I took out a payday loan of $300 almost 3 months back from Advance America.

I couldn’t repay the loan on time as I was going through a financial crunch. So, I opted for rollover and a hefty rollover charge has been added to my loan amount!

Due to this pandemic, I have lost my job. And I don’t know how to get rid of my payday loans. I am getting calls from the lenders to make payments. Else, they are threatening me to get arrested! So, my question is, can I get arrested if I don’t pay off my payday loans?

Solution:

No, you can’t be arrested if you don’t repay your payday loans. However, the payday lender can sue you in court as Advance America is legal in California.

And if they win a judgment against you or you fail to appear in court, the court can issue an arrest warrant against you. So, if you ever receive a court summons, never fail to respond!

If your lender threatens to arrest you, report it to your state attorney general’s office or register the complaint to the Consumer Financial Protection Bureau (CFPB)!

Scenario 5:

My name is Barbara and I am a resident of San Diego, California. In March 2020, I took out 2 payday loans from Cashback loans and Moneytree of $250 and $200 respectively.

But unfortunately, due to this deadly virus, my organization is not running smoothly! And I am having a substantial amount of pay cut. Eventually, it is practically impossible for me to get rid of my payday loans right now!

So, what will happen if I don’t repay my payday loans?

Solution:

Hey Barbara!

Firstly, if you fail to make payments on time, the payday lenders are gonna make automatic withdrawals from your account (if you have given them access as a part of your loan agreement).

Besides, you might start getting collection calls from your lenders. If things get worse, your lenders can sue you in court too. And if you fail to respond to court summons, the judgment might go against you.

So, if you start receiving collection calls, it’s better to settle payday loans and get rid of them!