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Payday Loan Payoff: Any Amount Will Help Relieve Interest Costs

Written By renie kolo on Thursday, April 18, 2013 | 7:29 AM


When trying to keep up with regular bills as well as payoff a payday loan account, any extra money will come in handy. Most lenders and creditors will be happy to take money from you at any time with no extra charge. You may find a few happy to take your money at an extra cost, so ask about early payoff fees while you shop for a good lender or creditor.

You may want to think twice before applying for a loan which will charge you for paying early. Most lenders will be happy to take your money anytime during the term of the loan. Because of the high risk factor involved with payday loans, early payoff or accepting an extra payment towards principle are most often welcome.

Credit card companies are similar in accepting extra payments or early balance payoffs. Since this credit is revolving, the creditor is always in hopes that the customer returns for future purchases. This steadfast buying power oftentimes tempts customers to continue using the card even after working so hard to pay it down or off.

Anytime you have the chance, and your lender supports it, send in extra money. It doesn't matter how much or how little. Payday loans which have been extended beyond the original due date sit and quickly accrue interest based on the remaining principle balance. The le the balance, the lower the interest cost. Instead of letting your budget go astray from a payday loan gone bad, take every opportunity you can to lower the principle.

*Find a second job

*Do some work on the side

*Hold a garage sale

*Sell items on an Internet venue

*Cut back on the extras

*Watch your grocery costs

*Return cans and bottles

Falling into the trap of obtaining a new loan in order to pay off an old loan still hurts the budget. The best way to get rid of a short-term loan completely is to pay it all off as soon as possible. If it means forking over some birthday money, or cutting back $10 each week on groceries, the principle must keeping spiraling downward. As the principle goes down, so will the charges from interest. Since interest is based on principle, both get lowered. When interest charges goes down, you will be free to put more money towards interest. Don't give up cutting back while the loans are still left unpaid. Make a payday loan payoff your number one budget priority then attack the credit cards. The less third party money listed as debt, the more money you will have to keep for yourself.

Once you get the debt paid off, keep that same strategy in tact but send the money into a savings account instead. Until you can support yourself against emergency costs hurting your budget, you may not want to splurge that extra money coming in. Create a "celebration" fund which will give you the freedom to do fun things without jeopardizing all your hard work paying off payday loan and credit card debt.

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