8 Alternatives to Costly Payday Loans

Figuring out the best payday loan alternative can be tricky. We're here to help you compare your options and choose the best one given your situation.

If you are searching for loans, you should be familiar with payday loans. They are appealing to those facing financial woes. Payday loans are generally bad and predatory lenders take advantage of those who are stumbling in financial disasters and trap them in the never-ending cycle of debt. Financially vulnerable individuals are their apex target.

Nonetheless, by now you should be wondering what are the best alternatives to payday loans? But to determine the best option for you, you can learn about your options and alternatives to online payday loans.

What is a Payday Loan?

A payday loan is a small, short-term unsecured loan, “regardless of whether repayment of loans is linked to a borrower's payday.” The loans are also sometimes referred to as “cash advances,” though that term can also refer to cash provided against a prearranged line of credit such as a credit card.

This article is all about lending a hand towards your alertness and vigilance to help you avoid payday loans. Payday loans look enticing but they can have demoralizing effects on your personal finances and can be a cause of long-termed frustration and despair.

Give yourself a pat on your back if you have avoided a payday loan to this date. But if you haven't, there are a number of actions you can look for in payday loan alternatives. Let’s take a look at some suggestions for you if you are trying to break away from an ongoing payday loan debt cycle.

  1. Approach an official and trustworthy credit counselor
  2. Look for payday loan alternatives
  3. Consider a low-interest rate consolidation loan

It also important for you to know that there are much better options available for you if you want to borrow fast money for emergencies:

Best payday loan alternatives:

Reason for taking out a payday loan: Alternative to payday loan:
  1. Emergency costs arise.
  2. No outstanding crippling debt.
  3. Credit Score of over 700.
You could use credit cards instead. Top picks:
  1. Emergency costs arise.
  2. No outstanding crippling debt.
  3. You have a credit score of over 600.
We recommend personal loans instead. Top picks:
  1. Emergency costs arise.
  2. You do have long-term debt.
  3. You have a credit score below 600.
Use Payday Alternative Loans (PAL) instead.

The Best Payday Loan Alternatives of 2020

The best payday loan alternatives are given below. You can compare your options and choose the best one given your situation. Be sure to review all of your options before making such a big financial decision:

1. Negotiate with your creditors

All the creditors are not the same. Consequently, everybody in the loan lending business isn't rude and will hear you out. It's always nice remembering that there are some nice and polite creditors in this fast-paced capitalistic economy. If you have a temporary hurdle in cash flow, they will definitely understand your condition and will assist you in providing some sort of relief. Discuss your problem with them and ask for an extension in the repayment procedure.

 2. Use your credit cards

Consider using your credit cards to pay for any unexpected emergencies that arise. If you have a good credit score then they can be a great option for most people. Both the Discover it® Cash Back and American Express Blue Cash also offer great introductory 0% APR offers. A 0% intro APR offer means that you won't have to pay interest on your purchases for a specific time period which will be explained on the card's website. Generally, most intro APRs range from six to twelve months.

Just remember to not make it your routine or habit to rely on credit cards for emergencies. After all, that is why you should build your emergency savings fund sooner rather than later.

3. Consider small consolidation loans

There are pawnbrokers or credit unions that can good options to consider but require long and outdrawn procedures and paperwork. These loans are approved after going through detailed documentation and verification procedures.

4. Take an advance on your paycheck or salary

You can also think about taking an advance in your salary if your job offers this. There have been times in previous work environments where an employee would ask for an advance and most smaller companies are willing to accommodate your needs. Your advance will simply be accounted for on your next paycheck. It's essentially a payday loan without the fees and headache.

5. Use selling apps

If you have some things lying around your home that you can sell to cover any unexpected costs then all the better. Before applying for payday loans. check how much you can get for your unwanted stuff. For example, you can sell your gold jewelry or even used selling apps to sell your used DVDs for quick cash.

6. Try to make extra income

Ask your employer to work a little longer and earn some extra money by working overtime.

7. Pick up a quick side gig

If you have any talent, it’s a perfect time to show it to the world, go ahead and get benefit from it. Take a look at some ways to make $60 quick here.

8. Borrow from friend or relative

If you want to avoid payday loans and the notoriously high interest rates, it’s better to borrow from your friends or family members. Don’t feel embarrassed, share your financial condition with them and the worse they can say is no.

The Bottom Line

Figuring out the best payday loan alternative can be tricky. We're hoping we helped you compare your options and choose the best one given your situation.

In addition to all above-mentioned best payday loan alternatives, you can also consider short term consumer loans and check for emergency community assistance plans if possible. An auto loan can also be an alternative if you own your vehicle. Personal installment loans are also a good option because they come up with comparatively low-interest rates.

The bottom line is that you have options and being a sensible and responsible individual means you should weigh them all out. Ultimately working towards having a plan to deal with uncertain circumstances and emergencies is ideal. This is if you want to escape from getting deeper inside the debt cycle by avoiding payday loans.

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