Payday Loan Alternatives

While many individuals feel lost when their financial burdens creep up on them, the answer to their circumstances is very rarely a payday loan. Even those with seemingly few options do have others ways to ease their hardships. And, since our goal is to remove some of the misconceptions that people have about payday loans, and the relative ease with which customers are granted loans, we are going to discuss payday loan alternatives.

Credit Cards

Often those in trouble believe it is faster and easier to take a loan from payday loan stores, as opposed to cash advances on their credit cards. As long as you have been making monthly payments on the cards and have not reached the point where your credit is ruined, it is possible to call the credit card company and request an increase to your limit in the amount needed for the emergency.

By doing this, you are going to save dramatically on interest fees and service charges, plus you are dealing with people you already know. Your payments will be a lot smaller, as well. Also, nowadays, most credit companies offer "balance transfer checks". These can be used with the same interest rate as purchases. You write out a check to yourself and deposit it to your bank account or you write the check to your emergency.

Credit Unions

Credit Unions have taken a major stand against payday loan companies. They are asking all member institutes to come together to battle the scourge of payday loans. They recognize the damage for which these loans are responsible, and they are encouraging potential customers to come into their branches to review more traditional borrowing. What you need to remember is there are various financial institutes that specialize in poor credit customers and are willing to do business. Recently, some credit unions have also offered payday loans, but at seriously reduced rates so it makes sense to shop around.

Speak with Existing Creditors

If you are in the most dire of situations and your creditors are calling, then you need to speak openly and honestly with them in order to setup an alternate payment plan or to extend your payment date. Today, companies are more interested in getting smaller, steady payments over a longer period of time, than getting nothing at all. And, in the case of an overdue mortgage payment, there is refinancing, debt modification plans, and government programs of which you should be aware.

Contact a Charitable Credit Counseling Agency

If you need to think about the possibility of using payday loan services, you most likely need help in general with your finances. There are many excellent community organizations who will help you to speak with your creditors and may even help with your emergency.

Does Your Employer Have an Advance System in Place?

Some organizations do allow employees to take a small amount of their paychecks on a date earlier than payday. Generally, it is done as an employee benefit and service charges are not applied. On payday, they deduct that amount from your check. But some employers do allow larger amounts and permit them to carried over two or three paychecks. If this is an option, you should explore it without delay.

Outstanding Vacation Pay

Although many employers do not want the hassle of extra bookkeeping, there are many that will allow you to withdraw monies from your vacation pay. If you do have outstanding monies in your account, it would preferable to ask your employer about being paid out early so that you can cover your emergency with your own available cash instead of financing with a payday loan.

Think Creatively

It is true that when an emergency happens, you are quite emotional and not necessarily thinking clearly or innovatively. But if your car breaks down and you need repairs, it is possible to get around having the cash today. When dealing with smaller garages, there may be the option to barter your services. Also, you may be able to make arrangements for payments if you agree to pay the balance on payday. In many jurisdictions, garages have "mechanic's liens" available to them. This means that if you do not pay your bill, they can legally place a lien upon your car. Because of this, they might just work with you to pay off your debt for car repairs.

Strategies that Are Doable but Require Time

Other things that you can do to help your situation are: