7 Alternatives to Payday Lending: Know Your Options
Payday loans can be great for emergencies and unexpected expenses, but they aren't the only sources of money around. You can take advantage of a wide range of lending options if you know what to look for. If you want to avoid the high interest rates and immense pressures that come with payday lending, you may want to have a backup plan in mind. The infographic below highlights 7 alternatives to payday loans so you can explore other venues for money. You may be better off than you realize (
Here are some more detailed explanations of the suggestions from the infographic:
1 Consider a Startup
Sites like Lenddo, BillFloat, and LendUp are changing the payday loan process entirely. They are designed to give you the money you need right online in exchange for an auto-repayment plan that draws money out of your account each month. In the case of BillFloat, they pay a bill for you and charge no interest when you pay it back in X days. The "X" will vary based on the value of the loan. Startups have simple terms for their loans, and many of them are much more affordable than payday loans. That's what makes them good alternatives.
2 Get a Small Personal Loan
Credit unions are usually pretty good about giving out small personal loans. They may require more proof of income and better credit than a payday lender would, but they will have lower interest rates and higher loan values to choose from. You can try contacting a local bank as well, especially if there is one in your area you already work with. Otherwise, you may want to call around or use a site like ASmarterChoice to find a credit union near you.
3 Ask for a Payday Advance
If you have been working at the same job for a while, you may be able to ask for an advance in your pay. Large corporations usually are not able to do this, purely because they have to pass through a chain of command to issue paychecks. For smaller companies where your boss is the actual owner, getting an advance in pay is not that crazy of an idea. Just explain your situation and see if your boss will pay you upfront for work. Then work extra hard the following week to show your commitment to your promise.
4 Sell Stuff You Don't Need
If you have stuff lying around your house that you no longer need, list it for sale and make some extra money off it. eBay is a good place to start for electronics, antiques, and collectibles, though you will have to pay a small fee for any sales made here. If you do not want to do that or you want to sell something with a high shipping cost, list it for free on Craigslist and see what happens. If you have a lot of items to sell, hold a garage sale in your neighborhood. You can advertise that on Craigslist as well.
5 Talk to Your Creditors
Have you tried working things out with your creditors and collection agencies yet? Most of them will cut you some slack if you stay in constant communication. Let them know what your situation is and how much time you need to get back on your feet. Hopefully they will be both sympathetic and helpful for you.
6 Earn Money from Your Hobbies
Have you ever tried Fiverr or TenBux? These are sites that allow you to post task you would be willing to do for $5 or $10, and then other people can contact you for work. This could be simple, like photo editing, short writing, researching, etc. It just has to be feasibly accomplishable online. FunAdvice.com recently launched a program like this as an extension of their advice site. You can check it out in the gigs section.
7 Look into Emergency Hardship Programs
Some bill companies have emergency hardship programs in place to help people with overwhelming circumstances preventing them from paying their bills. For instance, if you were in a car accident or lost your job, you may be able to get help temporarily until you get back on your feet. This will either wipe your bills away or give you long extensions to repay them. Then you can return to a normal payment schedule.
Even More Alternatives
If those seven alternatives to payday lending weren't enough, you could try a classic: ask your parents for money. This may require a small breakdown in pride, but it will give you a chance to borrow money without hurting your credit.
You could also think about pawning your belongings if you think you can pay back the pawn loan. Just note that if you can't, you will lose those items altogether.
Another option may be to look for random jobs online that you can do temporarily. Craigslist has some great offers like that in the "gigs" section of each city.
Yet another option may be to get a credit card to cover your current expenses. If you have bad credit, this may be a little tough to get approved for. If you have limited credit or decent credit, you should at least be able to find a card with a $500 limit to help you pay a bill or two. Just remember to pay back your balance quickly to avoid interest charges. Use a site like LowCards.com to compare credit card offers online.
You don't have to work with payday lenders to get back on your feet. There are many other routes to take first. Think about this list and see if you can find a smart, low-cost way to get the money you need. You'll be free of stress in no time.
Have some other payday loan alternative in mind? Drop a comment below!
Edwin Taivonen | ASUVA53PXDN7
Please include attribution to http://localcashguide.com/ with this graphic.