Alternatives

Payday loans are expensive and many people end up digging deeper and deeper financial holes as a result of taking out these high priced loans. While the loan is designed for emergency financial situations, it also takes advantage of your needs by charging ridiculous fees and interest rates.

Fortunately, when you have an emergency situation, alternatives to payday loans are available to manage obtain the money you need. The alternatives can help you get out of payday loan debt and reach toward financial freedom so more of your hard earned money is available in your pocket rather than going to your lenders.

Employment Advances:

One option that is better than a payday loan during a financial emergency is asking about an advance on your salary at work. Unlike a payday loan, which charges a high fee when you have an emergency, getting a salary advance will not cost you a penny.

A salary advance is not a loan, but rather future payment for the work you do in your job. Some employers offer employees this option in case emergencies arise so that employees avoid financial traps. You do not pay for the advance because it is part of your salary.

Credit Unions:

Members of a credit union are able to stop payday loans by taking a loan from the union. The union will charge only around 12 percent interest and does not have other fees, so it is obviously not a payday loan. In general, a credit union will have limitations on the amount you borrow and it automatically takes the money from your next paycheck, but it gives you a no payday loans alternative when you aren’t sure what else to do.

Bank Loans:

When you are thinking of how to pay off payday loans, one option that will help is a personal loan from the bank. Most banks offer personal loans to clients that have a much lower interest rate than the payday lenders offer. The personal loan can also be a small loan so that you are able to manage too many payday loans.

In general, you want to say personal loans not payday loans when you have a financial emergency because the personal loan from a bank will cost less even if you have poor credit. Some banks even cater to those with poor credit because they understand that you might have a situation where the payday loans or other debts have gotten out of hand.

When you are thinking of potential alternatives for your financial needs, saying I need a personal loan not a payday loan will remind you that you have other options.

Credit Card Advances:

Payday loan alternatives also include credit card cash advances. A credit card will often charge a rate of around 20 percent to 30 percent APR on a cash advance. Some companies even offer special deals for cash advances, depending on the company and their current promotions.

Even the highest rate cash advance from a credit card is much lower than a payday loan. These non payday loans options made available by your credit card not only gives you the money immediately via an ATM machine, but it also allows you to pay off the loan slowly so that your payments remain reasonable.

Military Loans:

Veterans or active duty military personnel have another potential alternative to the high interest payday loans that are more reasonable. A military loan provides retired or active duty military men and women with funding up to around $10,000 at an APR rate that ranges between 33 percent and 35 percent, which is much lower than the rate offered by payday lenders. This loan also allows men and women to slowly pay it off rather than trying to pay the full amount within two weeks.

Credit Counseling:

When the payday loans start getting out of hand and you are not sure how to get out of payday loans, turning to a professional for help is often the next option available. While you might apply for personal loans to repay the payday loans, some banks might not approve the loan. A professional credit counselor is able to provide you with more information about your personal options based on looking at your personal financial situation.

The counselor is also able to help you obtain loans to pay off payday loans and break the debt cycle that is dragging your finances into the gutter. Usually, the counselor will offer you advice on the options available to you and then help you work out a personalized plan to get out of debt and work out the situation.

In Conclusion:

Paying off payday loans does not need to become a painful process. Instead, taking out a lower interest personal loan or similar alternative can provide you with means to repay the debts. It also gives you another option if emergencies arise later so that you will never find yourself with so much debt you cannot repay it.