We get asked the following question way too many times in a week: Payday loan jail: can they arrest me?
Seems payday loan collectors will stoop to any level they need to in order to scare the borrower enough to get them to do what they want.
The answer to this question is well…. yes people can end up in jail over owing money.
Lets take a look at what a debtors Prison is.
There are no payday loan jails per say, unless you call being caught in the payday loan trap jail and many people do.
Yes they can take you to court and sue you, but most do not. They would rather have you in the trap so they can keep making money off of you.
Caught in a payday loan trap?
What they Really do
What these payday loan companies really do is hope a customer takes a loan out and runs into trouble paying it back thus they can offer the borrower the option of rolling over the loan.
This usually leads to Gotcha!
This starts the whole interest and fee process over from the roll over date and deducts nothing from the original loan.
A simple $250.00 two week loan can soon blossom into several thousand dollars in interest and fees in a matter of a month and they now have the borrower trapped.
Now they can start hounding the customer to pay on the loan, but they can usually not come up with enough to pay it all off, thus the outrageous interest and fees just keep adding up by the day.
They have talked people into selling all their property, using pawn shops and borrowing from relatives and friends.
They call the borrowers at work and at home and they also call all of the references the borrowers wrote down when taking out the loan up to and including calling their bosses.
They will threaten court action and jail time if the borrowers do not pay immediately.
In other words they will resort to almost anything to collect, but they do not want to collect it all, by the borrower leaving any balance at all keeps the interest adding up and them making money and lots of it.
Even though many of the tactics these loan companies use are in fact illegal that fact rarely slows the collectors down.
What the borrowers can do
Most borrowers are so scared and out of sorts by these collectors actions they feel trapped and backed against the wall.
People have paid and paid for months until they simply ran out of all resources and all they would have really had to do was contact a payday loan consolidation company.
A good company would immediately turn the tides on the payday loan company and put the power right back into the borrowers’ hands.
Once these payday loan companies know the customer is on to them and have hired a solution to the problem, they negotiate down the debt and agree to easy payback terms with the consolidation company.
They will stop the calls and the interest and get this out of their way as they know they can no longer work the payday loan trap on this borrower anymore so they concentrate on getting rid of them and moving on to the next victim.
If one finds themselves in trouble with out of control payday loan debt the first and only option the person should even consider is finding a good highly rated and trustworthy payday loan consolidation company.
This will take the control out of the lenders’ hands and put it where it belongs, back with the borrowers.
Before these companies can ruin the borrowers’ banking account, destroy their friendships and get them fired from their jobs, let the consolidation company do all the work and get this taken car of in as little as a day!
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