Payday loans get a bad rap; unfortunately, a lot of it is warranted. They offer horrible rates and fees that many people rightfully consider predatory. For many, payday lenders can seem like the only option. But getting financing for an emergency when you have less than stellar credit or don’t have the time to establish a credit history is not impossible; you simply have to know where to look. Here are some of the best alternatives to payday loans.
Credit unions are community-oriented and have a more personal approach to credit. While your credit rating will be important for applying for a loan at a credit union, it’s your history with the union that will matter the most. They will also look at your income. This is a good option if you are a member of a credit union and in good standing. If you aren’t, now would be a good time to join one and start establishing a history with them.
Instant loans, or installment loans as they’re commonly called, are the closest thing you’ll get to a bank loan, but without the stringent requirements. Like payday loans, the lender will look at your employment situation to assess your creditworthiness. And, like payday loans, these will usually be limited to small sums. For example, lenders like Loan Express Instant Loans will lend up to $1500 that can be paid in several installments.
The Bank of Mom and Dad
Another thing you may hesitate to do is reach out to people you know. But if it’s not a habit of yours, and you don’t have a history of not paying back, then you shouldn’t feel bad about being in a tough spot.
If they care about you and have the money, then they are more than likely to help. This also goes if you failed at some project they warned you about. You may be embarrassed by the failure, but again, people who love you will be more than happy to give you a hand — assuming you aren’t trying to take advantage of them.
One thing you have to make sure, however, is that you treat this loan like you would any other. This means that you should have a clear date for when you’re going to give the money back and even consider making monthly installments. If you repay on time, also know that they are more likely to help you if you have any other issues in the future.
Like payday loans, a pawnshop should be your last resort; but unlike payday loans, they’re a viable way to get money for some of the things you have around the house that you no longer need. Maybe you have power tools you haven’t used in a while, or an old bike laying around somewhere. You might be surprised at how much money you could get for them. Pawnshops also value relationships, so if you’re a good payer, expect them to give you better deals and more lenient terms.
Remember, when you’re in a tight situation and need money fast, there are alternatives besides payday loans. Just make sure that you take your time when choosing your options and treat them responsibly.
Photo Credit: pixabay