Payday loans have become much more popular in the last few years. Unfortunately, for many borrowers, the same economic conditions that caused them to seek help from the payday loan industry are also preventing them from being able to repay the loans on time. While many payday lenders permit borrowers to roll their old loans over into new loans, this usually results in more fees and late penalties. Eventually, this can become too much for some borrowers and they need a way out that avoids mounting fines.
This is why it is important for payday borrowers to seek loans from lenders that are members of the Community Financial Services Association (CFSA). This organization ensures that each of its members will agree to an extended payment plan for every customer once per year. Such a plan allows struggling borrowers to repay a loan over the course his or her next four pay periods in equal installments. Interest does not accrue on this plan and fees are not added.
The influence of the CFSA is such that many non-members also agree to these conditions. It is also possible that the state in which borrowers live may demand such arrangements by law. This is why it is important to review the standing of your payday lender before you sign any paperwork. Take the following steps to seek your own extension of a payday loan.
How to Extend a Payday Loan
- You should always find out if your lender is a CFSA member before you accept a loan. If it is too late for that, you can find out on your own if your present lender is a member without asking directly. Look for a blue oval sticker on the office window of your lender if it is nearby. If it says CFSA, then you are in luck. If you do not see such a sticker or are prevented from going to the office, look up your lender on the CFSA website. If you do not see your lender’s name there, do not despair. Not all lenders are listed.
- If you are sure that you cannot pay back your loan on time, call or meet with your lender before the close of business on the day that your loan is due. This contact must be in the same format that you used to get the loan. Therefore, if you got this loan online, you will need to make this contact online as well. The payday loan agency will ask you to sign a new payment schedule. No new fees will be added after you sign this agreement.
- If your lender denies you this opportunity, file an official complaint with the CFSA. This organization will provide assistance in rectifying this matter.
- Once you have an agreement and have signed it, you must adhere to its requirements. Make the payments in full and on time. If you follow the terms of your payment plan, then your lender will not be able to assess any new fees or harass you in any way.