Payday Loan Consolidation: Payday Loan Relief that Works

For many stuck in the payday loan trap, payday loan debt consolidation is one of the only form of payday loan debt assistance that can help.

See How Much You Could Save

Are you stuck in payday loan debt?  Rest assured that you’re not the only one looking for a bit of payday loan relief.

Payday loans are short-term loans that seem like an easy solution when you’re short on cash.  

You just need a bit of cash to make ends meet.  But then you miss a payment, so you rollover your loan.  Or you take a new one.  Before you know it, you’ve got multiple payday loans you just can’t pay back.

You’re stuck.  It’s called the payday loan trap for a reason.

But you’re not alone…

Did you know…

Does that seem fair?  No, it sure isn’t.  

Fortunately, payday loan consolidation is a way to reduce your debt amount and interest rates.

Do you need payday relief?

Get lower payments and interest rates with a payday loan consolidation program.

What is payday loan consolidation?

Payday loan consolidation is exactly what it sounds like.  Rolling up all your payday loans into a single one with lower interest rates and better repayment terms.

That’s right.  One loan, with lower fees, that’s easier to repay.

There are really two types of ways to consolidate your loans: payday loan relief programs and debt consolidation loans.

Here we’ll cover these two.    

Type 1: A Payday Loan Relief Program

A payday loan consolidation program involves working with a firm who will represent you to the lenders.  These can be referred to as a payday relief program, a debt settlement program or a debt management program.

They will charge you a flat monthly fee, and take on the liability of paying your lenders.

Sometimes they negotiate with the lenders to reduce fees.  Other times, they pay the lenders in advance and are essentially giving you a loan.  

Either way, you are given a flat monthly rate over an extended repayment period, with no interest calculations to do on your own.  You pay the firm, and they deal with your lenders.  

It’s extremely important to understand what they are doing behind the scenes.  Loan consolidation programs differ, and there are plenty of scams out there.  So be careful.


  • Help from experts
  • Reduced debt amount
  • Experts can negotiate better terms
  • Simple monthly payments
  • Reduced amount owed


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Type 2: A Debt Consolidation Loan (Do it Yourself Consolidation)

A debt consolidation loan is a personal loan that you take out to pay back your lenders.

The way it works is simple.

First, you apply for the loan, and get approved.  Once approved, you take that cash and pay off your lenders.  Now you pay back the new loan.

The benefits of a debt consolidation loan is that you are in complete control – you don’t need to wonder what someone else is doing.  On the flip side, you need to understand all the provisions of this loan.

Debt consolidation loans can be hard to get because of the credit check.  If you’re in payday loan trouble, you probably don’t have the greatest credit, so it may be tough to qualify.

There are a few different types of loans you can evaluate.

  • Credit Card Balance Transfer or Cash Advance: If you can qualify for a credit card, it likely makes sense to use it to pay off your payday loans. Credit cards have interest rates up to 33%, which are high, but not nearly the 400% interest rates that payday loans charge.
  • Personal Loan: A personal loan is a type of installment loan that is short term loan, typically of a term up to 12 months. They are typically unsecured and will have significantly lower interest rates than a payday loan.
  • Payday Alternative Loans (PALs): Not to be confused as simply an alternative to payday loans (though there are many payday loan alternatives out there), a Payday Alternative Loan (PAL) is a type of loan offered by credit unions. For more info on PALs, read this post here.


  • Reduced amount owed
  • You’re in complete control


  • Difficult to qualify
  • Need to completely understand loan terms
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Benefits of consolidating your loans

If you’re stuck in the payday loan trap, you can most likely benefit from a payday loan consolidation plan.  Here are several of the benefits of consolidating your debt.

1) Reduced fees and / or interest rates

Payday loans can have astronomically high interest rates.  In fact, often these types of loans have APRs of 300-400%!  A typical credit card APR range is 20-30%, so it’s easy to see why so many fall into the trap.

When you use a credit consolidation service, they typically reduce your interest rate to be between 6-30%.  That’s hundreds or even thousands of dollars saved over the course of your loan’s lifetime.

Unlike payday loans, which usually must be repaid within two to four weeks, personal loans offer a variety of repayment terms that generally range from 12 to 84 months. You can choose the term that works best for your budget.

2) Flat monthly payments

Most do not realize what happens when they are late on a payday loan, and that’s understandable: the fine print is so confusing even some of the world’s best lawyers have trouble comprehending it.  Late fees, high interest rates, rollover options; it’s almost impossible for anybody to understand them

When consolidating your loans into one, a great credit consolidator will package everything up into a plan that’s much easier to understand.  They will give you a much more straightforward monthly payment plan, where all you need to do is pay a flat amount each month.

3) Flexible terms of repayment

Unlike most payday loans, a personal loan designed for debt relief will give you some flexibility on the monthly payment amount, the timeframe of the loan, and the other associated components.  Most payday loan borrowers will find that a debt management plan is actually quite reasonable compared to payday debt.

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Legitimate Payday Loan Consolidation Services

In the world of short term lending, you need to watch out for scams.  We’ve done the hard work for you and picked three legitimate consolidation companies that can really help you.

1) DebtHammer (Top Pick)


DebtHammer offers payday loan relief, and is our top pick for those with debt problems.  

The company only works with clients that they can help, and it costs nothing to get a consultation.  First, they will take a look at your loan and the payday loan company that issued it.  

If it’s a lender they can help with, they will set you up with a 12-month payment plan and walk you through the process of how to work together.  They stop lenders from automatically drawing from your checking account, which reduces overdraft fees.  Then they will let the lenders and any collection agency the lenders hire know that DebtHammer represents you, and to talk to them.  

They do not charge an annual percentage rate  – the fee is flat and predictable.  If you need payday loan help, get a free consultation from the folks at DebtHammer.

2) Real PDL Help

Real PDL Help

Real PDL Help is a similar consolidation program that offers a free initial consultation where they assess your loan amount, interest rates and any other unsecured debt you have.

They’ll send you paperwork that includes a payment plan (monthly or biweekly options) and permission for them to represent you to the lenders.  They’ll get the lenders out of your bank account and negotiate with them on your behalf.  Then, you can stop making your loan payments to the creditors and just pay Real PDL Help via credit card. They also help you with debt collection calls, giving you advice on how to deal with them.

3) InCharge Debt Solutions

InCharge Debt Solutions | Credit Counseling, Debt Consolidation

InCharge Debt Solutions is third on our list only because they don’t specialize in payday like the other two do.  However, if the circumstances are right, they can really help.  InCharge is a 501(c)(3) non-profit that offers both credit counseling and debt management programs.  They are accredited by the Better Business Bureau.

4) Lending Club

Lending Club is a peer-to-peer lending platform that offers all sorts of loans, including debt consolidation loans. So this would be the do-it-yourself payday loan relief program.

The difference between Lending Club and other lenders, is that Lending Club is peer-to-peer. Meaning that other individuals are deciding whether to lend you money or not. You must have a 650 FICO or higher to qualify (yes, this means a credit check), and Lending Club does a decent amount of vetting applicants and assigns them a grade before it allows individuals to see whether you’re eligible or not.

Unfortunately, the high FICO requirement makes it impossible for most payday borrowers to use Lending Club, but if you can, you’ll likely get lower APRs than other debt consolidation options.

Alternatives to Consolidation

You don’t need to consolidate your loans to get out of payday loan debt.

But if you really need relief from payday loans and you can’t get approved for a personal loan or payday loan debt relief program, there are other debt relief options. Here are a few debt relief options:

Ask for extended repayment terms

Both storefront and online cash advance companies know that they will not get all of their money back.  That’s why the interest rate is so high.  So it can’t hurt to call your lender and ask for a repayment plan with reduced interest charges.  From their perspective, they’d rather get half of their money than none of it.

Also Read: Can you get an extension on a payday loan?

Work with a credit counselor

There are people who have dedicated their entire lives to fight payday loan lenders and help get clients debt free.  These are called credit counseling services.

Credit counseling services have wide expertise in many areas of personal finance, including credit card debt, mortgages, student loans, unsecured loans and more.  But one area they focus on is payday loans and helping people get out of the deadly payday loan cycle.  Be sure to do your research to understand whether your credit counselor has experience with payday loan consolidation.  They can seriously help your financial situation.

This video by Michael Bovee does a great job at explaining credit counseling.

Additionally, credit counselors stay in tune with guidelines and laws put forth by the Consumer Financial Protection Bureau (CFPB), a government organization that does all it can to fight predatory lenders. To find a local credit counselor, call your local credit unions and see if they have any recommendations.

Also Read: Everything You Need to Know About Credit Counseling

Talk to legal aid attorneys

Payday loans operate in the gray area of the law, and there are some attorneys that will work with you in order to fight the payday lenders and reduce your debt amount.  A competent lawyer will help explain your debt settlement rights and the best way to get out of your payday loan problem.

Related: Can a payday lender sue you?

File Chapter 7 bankruptcy

Note: this should be a last resort.  Talk to a lawyer before exploring this option.

Chapter 7 bankruptcy is a legal process that allows you to discharge some or all of your debt.  It requires you follow a very rigid legal process, and can result in asset seizures or wage garnishment.  It most definitely involves time in court.  State law governs bankruptcy, so your options differ by state. Around 800,000 Americans declare bankruptcy every year.

Also, there’s no way to keep a bankruptcy from being reported to the credit bureaus, so bankruptcy will hurt your credit score.  So be sure to only use this as your last resort. For more info on filing for bankruptcy, watch this video below.

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Frequently Asked Questions

Do payday loan consolidation companies work?

Short answer is yes, if you don’t get scammed. Additionally, you do need to stick to your payments – it’s not a silver bullet.

Whether you work with a payday loan consolidation company or take out a loan, you are taking a step out of the debt cycle and will likely reduce your total amount.  But you still need to stick to the plan.  Read more here

What are the pros and cons of payday loan consolidation?

Single, straightforward monthly payment
No hidden advance fees
Far lower interest rates
No more unauthorized automatic debits
No ‘gotcha’ fees like late fees and others in the fine print
Little to no harassing calls from collectors
Reduced chance of a lawsuit

You need to avoid any future payday loans
You must follow the advisor’s advice
In summary, assuming you pick a reputable firm to work with, the downsides are minimal.  Who loses?  The payday loan company.  And that’s something we can all celebrate.

Where do I make my payments to?

If you’re working with a payday debt consolidation company, you’ll make a single payment to that company once or twice per month.  

If you’ve taken out a personal loan, it’s up to you to use that money to pay down the lenders.  Then you’ll make loan payments until you pay back the new loan.

Do I need good credit to consolidate my PDLs?

This depends.

For payday relief programs / debt management plans, they may or may not need to check your credit report before putting you on a program. 

To qualify for a debt consolidation loan, however, you can bank on a credit check being required.

Will this reduce the amount I owe?

Yes, if done right, any PDL consolidation program should reduce both the total amount owed and the effective interest rate you will be paid.  You can ask the firm upfront to show you the before and after amounts and interest rates owed.

Can the government help with payday loans?

Unfortunately, the government provides very little help to individuals struggling with payday loan debt. As far as legislation, very little has been done at the Federal level. Several states have outlawed the payday loans, but often Tribal lenders use their Tribal immunity in order to give loans in these states. So unfortunately, Uncle Sam isn’t much help to payday borrowers.

Are there any non-profit payday loan consolidation organizations?

No, we are not aware of any non-profit payday loan consolidation companies. Be very careful if you see a payday relief organization that’s masquerading as a not for profit. You should be able to look up 501c3 non-profits on the IRS website.

Can I consolidate ALL of my payday loans?

This depends on a few things.

First off, if you’re working with a payday loan relief company, they may not work with certain lenders. This is particularly true for payday loan consolidation companies that rely on negotiating with lenders.

If you’re using a debt consolidation loan, you can consolidate as many of your loans as the debt consolidation loan will allow. So if you are approved for a $1000 loan and you have two payday loans with $500 each outstanding, you can pay off both of them. However, if you have three payday loans with $500 outstanding, you can only consolidate two of them. If you’re in this scenario, always pay the highest interest loans first.

Can you settle payday loans?

This depends on the lender. Some lenders will reduce your debt if you ask them. Other lenders have firm no-settlement policies.

No matter who your lender is, it does not hurt to ask. For your best chance at settling your debt, you need to make a strong case to the lender that you will not be able to pay. The lender needs to think “it’s better to get some money than no money”.

What is the best payday loan consolidation company?

Our pick for the best payday loan consolidation company is Debthammer.

How can I get help paying my payday loan?

As discussed in this article, there are many ways that you can get help. You can work with a reputable payday relief firm, you can talk to credit counselors, and you can ask friends and family for help.

Can you go to jail for not paying a cash advance loan?

No, you cannot go to jail for not paying a cash advance, payday or any other type of loan in the United States. For more information, read this article. Debtors prisons are no longer legal in the US. However, if you receive a court summons and fail to appear, you could be charged with a misdemeanor of failing to appear in court. This is not the same as going to jail for not repaying a loan.

Is National Payday Loan Relief legit?

We couldn’t find any online reviews about the company, so we do not know.

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Getting Relief & Becoming Debt Free

The benefits of being free from payday loans are numerous.  The late fees, interest charges, and other penalties that accumulate can end up being several times the amount that was initially borrowed, leading to a pile of debt that gets harder and harder to replace.  Not to mention the hit to your credit score and the constant threats of being jailed.

And not only is the financial burden significant, but the amount of stress is enough to seriously hurt your health and the well-being of you and your family.

Getting out of payday loans can change your life, and payday loan consolidation programs are the easiest way to get out of the payday trap and back to living the life you were meant to live.

Borrower Stories

Jeanine D.


“I owed over $4,000, and half of that was in fees. Thanks to payday loan consolidation I was able to reduce my amount owed to only $200 which I’ve almost completely paid back!”

George F.


“My payday loan debt got to the point where I would never pay it back, and I went into extreme depression. My health and family suffered more than I can say. I’m so glad I consolidated my loans and will never go back to the payday loan store ever again”

Grace B.


“Thanks to payday loan consolidation, I was able to reduce my fees to only $200 months. I started saving, working overtime, and was debt free in about 12 months. A huge burden off my shoulders”

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