Payday loans are a short term solution for money emergencies. They are provided for a limited time and with high-interest rates charged. So, it’s not a big surprise that many people have difficulties with loan repayment. However, for the cases like this
- If a borrower feels that they won’t manage to pay off the payday loan on time, they can refer to the lender with a request of extending the repayment period. This option is called a roll-over.
If the lender gives the green light, then the period of repayment is extended and this gives the borrower extra time to find the necessary sum to pay back the loan and manage his/her budget. It is worth mentioning that rollovers involve additional fees and higher interest rates because the lending company takes high risks giving money to the borrowers and extending the repayment period.
- However, roll-overs as well as interest rates are subject to state laws. Some states with restrictive policies prohibit such extensions, others only allow one, or several under certain terms. Before entering into any loan agreement it is necessary to check local state laws and regulations. Always read the loan contract carefully before signing it. Pay close attention to the points related to interest rates, repayment terms and the possibility of rollovers.
More information about payday loan roll-overs and extensions.