Payday Loan Alternatives: What Option Is Best for You?


You must not feel cash-strapped during that acute emergency, as a payday loan helps you disburse fast cash without any hassles. Understandably, money is required to cover most of the expenses, which is why it’s common to get attracted to a payday loan. 

Such loans are hassle-free, and some lenders don’t bother about your credit score. But as you’re short on money, it might seem the best option to avail – but not a firm reason to obtain one. So, what are the alternatives to a payday loan? 

Instead of getting such high-cost and short-term loans, which must be repaid on your next payday, here are the top 5 alternatives to consider while borrowing cash. Let’s get started.

  1. Bad Credit Loans

Do you want to avail yourself of quick cash but without worrying about your poor credit score? If so, the best payday loan alternative would be bad credit loans, which help you receive cash with a poor credit score of 690 FICO or lower. A broker like this has multiple lenders you can seek help from.

Often, online lenders modify their loans for poor credit borrowers, and they might sanction applicants with high debt-to-income ratios and poor to moderate credit scores. But when you’re uncertain about your eligibility to get a bad credit loan, you can pre-qualify to check what lenders can provide you. This process will never jeopardize your credit score; instead, it will help you compare the different loan offers.

  1. Title Loans

Title loans or car title loans, are also short-term, like payday loans, usually lasting 15-30 days. Hence, it could be an alternative to a payday loan as it uses your vehicle as collateral. The process of obtaining a car title loan is to hand over the car’s title to the online lender, upon which you will receive money. Hence, you will never get your car title back until you reimburse the borrowed amount along with the lender’s charges. 

  1. Borrow Cash from a Credit Union

Credit unions are member-owned and not-for-profit companies, unlike traditional banks. Due to this, you might find affordable charges at a credit union for other types of loans and credit union personal loans. 

Moreover, these credit unions mainly have less complicated eligibility criteria than conventional banks. Hence, the possibility is higher that you will be qualified to borrow cash with minimal credit. In brief, like an alternative payday loan, borrowing from a credit union requires you to be a member first.

On the other hand, these credit unions are affiliates of the National Credit Union Administration, providing payday alternative loans, or PALs. The money from a PAL can bypass payday loans, and the lower-cost payday alternative loans offer a maximum borrower time to reimburse a loan compared to a payday loan. 

However, a credit union can levy $20 for a PAL as an application fee. Simply put, the credit unions provide PALs with moderate APRs close to those of credit cards.  

  1. Tap Your Home Equity

As a homeowner, you might be qualified for a tax-deductible and low-interest line of credit. It would be excellent for those with a steady flow of income to access the fastest cash. However, the average rate of a home equity line of credit interest charged is approximately 4%. But you must use high wariness while holding your home for the fastest cash. For those in financial trouble, tapping home equity endangers your home if you can’t reimburse the debt. 

  1. Local Charities and Nonprofits

This payday loan alternative is considered the best one because of its free assistance to cover urgent expenses. However, local funding platforms, such as nonprofits and community hubs, are incredibly beneficial if you balance gas, groceries, and other expenditures with a newly emerging situation. Hence, such organizations could be a significant resource for distributing clothes, food, medical assistance, and job interviews. 

Regarding the speed of loan disbursement, it depends on how fast you can get assistance on what you require and which companies are in your location. Lastly, you must remember that charitable companies might need proof before donating cash, for example, recent pay stubs. 


Payday loans are often known as cash advance loans, which can be obtained quickly, but the borrowers need to pay a high price while paying off the debt. Hence, the five alternatives mentioned above are worth considering.

Now it’s up to you if you want to bypass the skyrocketing charges that come with these payday loans and obtain one of these alternatives from the list. The highly cost-efficient option you’re eligible for is likely the correct one for you.

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