Payday Loans are getting popular day by day as they provide quick and easy cash when one is suffering from financial emergencies. As the payday lenders provide fast cash, the more people are getting trapped in the loan cycle of debt day by day. Payday Loans are the short term loans which helps the people with the instant cash needs when they need extra credit to pay off sudden important expenses. No doubt the borrower gets quick cash but the interest rate on these loans is extremely high. The borrower has to repay the loan on due date otherwise they got trapped in the never ending loan debt.
Alternative to Payday Loans
If you need to borrow Payday loans, just make sure that you really need them. But there are many other alternatives to payday loans which are of lower rates and less complicated than payday loans. Payday Loans are not the only option when you are in debt. There are many other options that payday loans that will really help you to get out of the financial crisis. Some of these alternatives are: small savings account, salary advances from employer, credit card advances, and loans from friends or family or social service agencies. In addition to that, many payday lenders also offer payday loans at lower and affordable interest rates so that the customers do not have to suffer the problem in future.
Other options than Payday loans
Alternatives to Payday Loans
Ask for a Pay Advance
If you find yourself trapped in sudden financial crisis and needs immediate money to pay off the expenses, then you can ask your employer to give you advances on your monthly salary or wages. Sometimes it becomes difficult to manage the household expenses and extra expenses from the one month salary. When in need of extra cash, you can borrow it from the employer and he will give you the money without charging extra money. Moreover, the borrower does not need to pay any interest to the employer.
- Borrowing from family and friends
In need of emergency cash, one can ask their friends and family member to give them cash in order to avoid the financial situation. The main benefit of this kind of borrowing is that you do not have to pay any interest rate plus you can return the money whenever you want according to your needs. But before borrowing cash from friends and family make sure that you and they have time of budgeting and a repayment plan.
- Borrow loan from nonprofit organizations such as Credit Unions
There are many nonprofit organizations in USA which are glad to help the people in every possible way they can. These organizations offer various schemes and offers to help the people financially. Members pay money to the credit unions so that they can use them later whenever they are in financial pinch. This offer give them two benefits: One they can save money in this way and second they can use that money in future. One can find many credit union organizations on the internet and avail their services.
Budgeting loans lends you money to pay for some domestic expenses like clothes, utility bills, grocery, electricity bills etc.If one is working for 26 months, then they are eligible for budgeting loans. The smallest amount you can borrow is $100 and you can pay back them in 2 years.The money is transmitted to your account straight and you do not have to pay interest rate. One can apply for budgeting loans if they live in Scotland, England or north Ireland.
Instead of borrowing a payday loan, you can demand overdraft limit from the bank. The cost of the overdraft includes all administration charges, monthly fees and agreement cost. The borrower is kept charging interest until he repay amount. The bank has the full right to take away the overdraft anytime they want. So it is suggested that you should be aware about the repayment, cost and time limit of overdrafts if you owe any overdraft.
To help the people in financial crisis, there are other kinds of loans which are known as consumer loans. These loans are much cheaper than the traditional payday loans. Some finance companies offers small consumer loans to help people. The APR cost is up to 60% on these kinds of loans. A person can borrow up to $1000 for the time period of a year.
If you wants that you will never get trapped into any financial crisis, then you should make a prior budget from your monthly salary that includes all the expenses for whole month whether they are utility bills, school fees, hospital bills, auto repair etc. The budget plan helps you in planning extra expenses for future financial emergencies.
Consider payday loan as the last option only if every other method fails to give you cash when you need it. There are many other options to borrow cash. So in future before applying to the payday loans, first consider all the other options. Go for payday loans only if you are sure that you can repay the loan amount on time.
“The first step is to decide right now that you won’t take out another payday loan