Payday Loans Debt Repayment Plan

Get help if you’re struggling to pay back payday loans.

A Payday loan is a short-term loan with very high interest rates, they are offered by companies as fast-track small amount loans from £100 – £5000. Some payday loans may be for a higher amount too.

If you’re finding it tough to repay your payday loan along with your other bills, it’s crucial to address the issue before it worsens. Seek assistance here if you’re struggling with payday loan repayments.

Is Payday Loan good?

It depends on your situation, but there’s a likelihood that a payday loan isn’t a good idea. It’s important to make sure you think things through before taking one out. You should consider:

Introduction to Payday Loans & Continuous Payment Authority (CPA)

More About Payday Loan

Payday loans are offered with the agreement that they will be paid back within a short period, which can range between a few days to several months. This type of loan is designed to offer instant financial relief, and the sum of money is usually paid into the borrower’s account within 24 hours of agreeing terms.

These loans are quite attractive among people who want immediate cash for car repairs, emergency home repairs, boiler repairs, emergency travel, etc.

If you take out a payday loan, you can expect to have your repayments taken from your bank account via the use of Continuous Payment Authority (CPA), the permission you give to a business to take money from your debit or credit card as and when is required.

Payday loans are usually advertised with annual percentage rates (APR) of up to 1500%, but you will never pay back more than twice the amount you initially borrowed thanks to a ruling from the Financial Conduct Authority.

Most payday loan companies are members of a trade body, and it’s worth checking to see if the one you intend to choose is. Lenders are likely to be members of one of the following bodies:

The Finance and Leasing Association (FLA)

Consumer Finance Association (CFA)

Consumer Credit Trade Association (CCTA)

If the payday lender of your choice is part of a trade body, this is a sign that they are committed to learning more about their own industry and therefore more likely to offer its customers more informed and reliable information. Trade body members are more likely to stick to set laws that are for the benefit of providing better service for customers.

If you have difficulty in paying your payday loan back, it is worth knowing that payday lenders are likely to adhere to a shared customer charter which requires its members to:

  • Deal sympathetically and positively
  • Freeze interest and charges if:
    1. The customer makes repayments under an agreed/reasonable repayment plan or
    2. After 60 days of non-payment

If you do find yourself struggling to repay your payday loan, check with your lender and ask for advice. It’s better to tackle the problem head-on, rather than struggle in silence.

Continuous Payment Authority (CPA)

CPA is a type of recurring payment, similar to a direct debit, where you give permission for a company (such as a payday loan lender) to take money from your account on a regular basis. The CPA gives the company permission to take payments whenever they want and take payments for different amounts, without consulting you beforehand.

British pound bank notes

How does it work?

Continuous Payment Authority payments are favored by many other organizations including insurance companies, gyms, and internet providers.

You can Cancel CPA if you want:

It is your right to cancel a CPA directly with your card issuer if you are struggling financially. To do so, choose one of the following options:

County Court Judgement

It’s recommended you let the creditor know that you are withdrawing your continuous payment authority but to let your bank know as a priority to stop the payments from going out. You will need to ensure that you make a payment to the payday lender, however, based on what you can afford.

You’ll need to complete an income and expenditure form and send this with a list of any other unsecured creditors you owe to, and make an offer of payment based on any leftover income you have. If your living expenses exceed your income, then a token payment is required to show a willingness to make continued payments.

Check terms and conditions / Think before applying for payday loans

Please make sure you understand that you can afford to repay the loan on payday and whether the wages you will be left with are enough to cover the essential household costs you have to pay, such as your mortgage or rent, all the utility payments, and food shopping for the week or month.

What To Do If You Can't Pay Back Your Payday Loan

If you find yourself grappling with payday loans, it’s likely a signal that seeking assistance is necessary, especially if multiple loans are involved. Attempting to use more borrowing to resolve debt will only exacerbate your situation, and we strongly advise against taking out a payday loan to settle existing debts.

If you are unable to pay back the Payday Loans and are accumulating high interest charges on them, contact us now. Get free advice & free personal appointments to discuss your case.