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What Happens If a Payday Loan Rolls Over?


When a payday loan rolls over, it means the lender gives you more time to repay your loan. If you struggle to meet repayments, your lender may offer you a payday loan rollover.

A rollover aims to allow the borrower to pay off their loan with fewer late fees and without risking bankruptcy or damaging their credit score. I you are unable to pay your debts and repay a loan which you have borrowed, the best thing to do is to let your lender know immediately and contact a financial advisor, if possible, for professional support.

Short term loans like payday loans and emergency loans are designed to only be used in times of absolute financial emergencies. This means that if you have an alternative way to borrow money, you should always explore that before taking out a payday, emergency, installment loan or any other form of short term loan online.

What Is a Payday Loan Rollover?

If you approach your lender because you are having trouble paying back your loan, they may offer to extend the agreed time to pay it back; this is called a ‘rollover.’

A rollover is an updated agreement between you and the lender to repay the same loan. It is a new legally-binding contract that gives you longer to pay off the original amount borrowed. Lenders do not want people who borrow money from them to fall into further debt as it would mean that they will lose the money they have provided in the form of the loan.

Also, the more people that cant repay their loans, the more people that will end up falling into a spiral of debt, which is bad for lenders, borrowers and wider American society.

How Does a Loan Rollover Work?

A loan rollover works by extending the loan period to give you more time to repay your loan. This means that the borrowed money will also accumulate more interest. When you borrow money online for example, you and the lender who provides the loan will agree on the term of the loan and the date by which it needs to be repaid. Therefore, if you find yourself struggling to repay the loan, your lender needs to know as soon as possible.

Remember that if you agree a loan rollover with your lender, there will likely be extra fees or charges for rolling over your loan. Your lender should clearly communicate these before any agreement is made.

Can I Get a Rollover on My Payday Loan?

Whether or not you can get a rollover varies from lender to lender. Different lenders will have different criteria for who is eligible for a payday loan rollover. The best way to find out if you are able to get a rollover on your loan is to contact your lender. You may find that some payday lenders, installment loan providers and short term lenders will allow loan rollovers whereas others might not.

If you explain how you are struggling to repay, a lender will often offer another solution and will try to help you with a repayment plan to avoid further debt. Lenders want to avoid borrowers defaulting on loans or facing bankruptcy and are usually keen to work together to find a new, more manageable repayment plan.

What Are the Downsides of Payday Loan Rollovers?

A loan rollover in any circumstance should always be thought through and should not be something you turn to first. Always try to see what you can do to repay your loan on time and never hide from your lender if you are struggling to make repayments, as that could land you in more trouble and make things harder.

You should be aware of the potential downsides of extending your loan before agreeing to a rollover, which can include:

  1. Added Interest When you roll over your loan, the borrowed money will accumulate more interest. The longer it takes you to repay, the more interest you will end up paying to your lender
  2. Extra Fees There are often also extra fees or charges associated with a rollover. Your lender will tell you about these when offering you a new agreement
  3. Debt Cycle As interest accumulates, you could find yourself trapped in a cycle of debt. Each rollover you take will further increase the interest you will be paying on your loans

However, legally, your payday lender should not offer you more than one rollover. It would be best if you took time to consider your options before agreeing to a rollover, and it is recommended to consult a financial advisor. When a lender offers you a rollover, they are required to direct you towards free financial advice.

What Can I Do If I Am Struggling to Repay My Loan?

If you are struggling to repay your payday loan or any other form of short term loan, there are plenty of other options you might want to think about. While a rollover may be suitable for some people, it’s always worth considering all of your options before you make your choice.

Get Financial Advice

If you are unable to pay your loan back on time and cannot clear your debts, get in contact with a financial advisor to get professional advice and support. Get advice as soon as possible; the longer you let your debt build up, the more difficult it will be to resolve.

Many charities offer free financial advice to those in stressful financial spots, so you can get the help you need without paying. A financial advisor will look at your financial circumstances and advise you on escaping the cycle of debt.

Talk to Your Lender

One of the first things you should do it you are struggling to repay a payday or other short term loan is talk to your lender as soon as you realize this may be the case. The worst thing you can do is stop communication with your lender or avoid them altogether.

Keeping your lender updated on your situation is always best, especially if you have trouble meeting repayments. Most payday lenders will be keen to arrange a new payment schedule that you can manage. Bear in mind that payday lenders can take customers to court, so don’t stop paying your loans without a plan.

File for Bankruptcy

When facing unmanageable debt, there is always the option to file for bankruptcy. Declaring yourself bankrupt however is very much a last resort and not something you should turn to without a lot of thought and careful consideration.

Declaring yourself bankrupt can have a massive impact on your future credit prospects. The negative effect that declaring bankruptcy can have on your credit score can mean you will have more trouble borrowing for a long time into the future. Therefore, the decision to file for bankruptcy should not be taken lightly, and a professional should always be consulted.