Jul
26
what will happen if i default on a internet payday loan?
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I have 5 internet payday loans and cant afford to make the payments each payday any longer. What will happen if i default on these loans? How will the lenders try to collect? Will they be willing to work out a repayment plan with me? Can they continue to charge me interest while the loan is in default? I live in the state of Texas.
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4 Comments
May 13th, 2009 at 6:12 am
Possibilities:
1) payday loan agency may take you to small claims
2) sell your payday loan accounts to a colletions agency who will then pursue you
3) if there’s a court judgement, you may have your wages garnished
May 15th, 2009 at 8:51 am
They will collect and your credit score will drop like a rock.
May 17th, 2009 at 3:46 pm
Same thing that happens if you default on a non-internet loan! You are required to pay back any money you borrow, regardless of the source. If you do not pay, then the company who loaned you the money has the right to do whatever they can legally to collect it from you, including sending your account to a collection agency and garnering your wages.
I’d try to find some way to pay your loans back. Call the company and tell them your situation and see if they are willing to work out some type of payment plan. Companies would rather work with you for payment, than have to go to the extreme measures of collection and garnishment to get their money.
Good luck.
May 20th, 2009 at 2:06 pm
First, they will continue to pull the money out of your checking account which will result in bounced check fees and, potentially, being reported to Chexsystems and having your account closed.
If they can’t get the money out of your checking account, they will jack up your rates, charge you late payment fees and basically add on hundreds of dollars in charges.
They will report to the credit agencies as collections and probably sue you. Yes, they will continue to charge you interest.
You really need to try to get a loan to pay these off and NEVER do this again. These places charge 300-500% in interest and are one of the worst things you can do financially.
Check out prosper.com if your credit is still decent.
You need to get a 2nd job to pay these off and make sure you cut out all extra expenses (booze, cigarettes, eating out, internet, phone, cable, gym, etc.).
Get this taken care of before it ruins the next several years of your life.
Good luck!