What is Better Than A Payday Loan?

If you need fast cash, you might be tempted to apply for a payday loan. With a payday loan, borrowers are required to repay their loan on their next payday. If you take out a payday loan, the lender will ask you to provide either a postdated check or authorization to automatically withdraw the full balance from your bank account on your next payday.

Fortunately, applying for a payday loan is not the only way to get the cash you need to make ends meet. What is better than a payday loan? Here are some of your options:

Making A Payment Plan

Many people who get payday loans need cash to pay their bills. If you’re in this situation, you may want to consider contacting the creditor to discuss your situation before taking out a loan. 

Credit card companies, utility providers, and landlords, for example, might agree to the terms of a payment plan that allows you to make smaller, more manageable payments until your debt has been repaid. Some creditors may even agree to extend the due date of your next payment to give you more time to come up with the cash.

If your creditor agrees to this arrangement, make sure you comply with the terms of the payment plan. Your creditor could impose penalties if you fail to do so.

The worst your creditors can say is no, so it doesn’t hurt to try this option before exploring ways to borrow money. 

Asking for A Paycheck Advance

Some employers offer their employees paycheck advances, which are not the same as payday loans. A paycheck advance allows employees to borrow money from their upcoming paycheck. In other words, it involves the employer releasing the employee’s money in advance so they don’t have to wait until payday to get cash.

If you are given a paycheck advance, the money you borrow will be automatically deducted from your next paycheck. Paycheck advances are usually interest-free loans, so you will only need to repay the amount you borrow.

Some employers may not offer paycheck advances at all, whereas others may only offer advances under certain circumstances. The exact terms of paycheck advances vary from employer-to-employer, so make sure you carefully read through the agreement before accepting the cash.

Getting Help From Friends or Family

Sometimes, the best way to get fast cash is to turn to the people who are closest to you for help. If you plan on asking your loved ones for financial assistance, there are a few rules you should follow to ensure the conversation goes as smoothly as possible1.



• Make the request in person rather than over the phone or through email or text.
• Avoid asking anyone who has recently struggled financially.
• Be honest when it comes to explaining why you need the money and what you will be using it for. 
• Explain what efforts you have made so far to get the money. Tell your loved one how you have worked extra hours, picked up a side gig, or cut back on your expenses. 
• State the exact amount you want to borrow. Do not leave this number up in the air or tell your loved one that you will take whatever they feel comfortable letting you borrow. Be specific.
• Put a repayment plan in writing. The plan should outline how often you will make payments, the size of each payment, when the payments will begin, and how long you have to repay the loan in full. If you agree to pay interest to sweeten the deal, include these details in your plan as well. Everything should be in writing to reassure your loved one that you are taking the loan seriously.

You might feel uncomfortable asking your loved ones for such a big favor, but this could be the easiest, fastest way to get cash.

Utilizing A Peer-to-Peer Lending Service

Peer-to-peer lending services are platforms that match borrowers with individual investors. An investor who signs up for this type of service can review loan requests from borrowers to determine which one, if any, they want to fund.

There are a number of different peer-to-peer lending services, including Upstart, PeerForm, Prosper, and Funding Circle. Each of these services has different terms for borrowers and investors, so do your research to determine which one is right for you.

For example, each peer-to-peer lending service has established different minimum and maximum loan amounts. Make sure you choose a service that will be able to provide you with the full amount you need.

The minimum credit score requirement can also vary from service-to-service. Some peer-to-peer lending services only work with borrowers with established credit histories and good credit scores.

There’s no guarantee that you will be able to find an investor who is willing to lend you money via a peer-to-peer lending service, but if you do, you may be able to quickly obtain the cash you need.

Borrowing From Your Retirement Account

About one-third of working adults in the U.S. are currently saving for retirement in a 401(k). If you currently have a 401(k), consider borrowing from it in the event you need to get cash fast. 

Borrowing from your retirement account is similar to borrowing from a lender. You will need to repay the money you borrow and you will be charged interest for borrowing it, too. However, the money you repay will go back into your retirement account. This includes your interest payments. Every dime will go back to your account, so you’re not actually losing the money, but rather saving it for the future.

You are usually allowed to borrow up to 50% of your account balance with a maximum of $50,000 in a 12-month period. You are typically given five years to pay the loan and interest back, but the terms may vary depending on your employer’s plan. 

It’s important to note that borrowing is not the same as withdrawing from a 401(k). If you borrow, you will not need to pay taxes or incur penalties on the money taken from your retirement account. You will have to pay taxes and additional fees on money that is permanently withdrawn from your account, though. For this reason, borrowing is a much better option than withdrawing.

Using Your Credit Card

If you need cash to cover an unexpected expense, using your credit card is a better option than taking out a payday loan. You will be charged interest on this purchase, but credit card interest rates are much lower than payday loan interest rates. 

Plus, you will be given more time to repay it if you charge it to a credit card. On the other hand, a payday lender typically requires you to repay your loan in full within a few weeks.

Think about opening a credit card if you don’t have one already. You don’t need to have perfect credit to get approved for a credit card, so don’t let this hold you back2. However, if you decide to open a credit card, make sure you use it responsibly. You should only charge purchases to your credit card that you can afford to repay over time. 

Another option is using your credit card to get a cash advance. Taking out a credit card cash advance allows you to borrow against your credit card to get fast cash. You may be able to use an ATM to quickly get cash through a credit card advance. The interest rates on credit card advances are higher than the interest rates on standard credit card purchases, but they are still lower than the rates for payday loans.

Applying for A Title Loan

If you own a car, truck, SUV, RV, or motorcycle, applying for a title loan might be the best option for you. A title loan is a secured loan that uses the title to your vehicle as collateral. You won’t need to give up your vehicle to get cash through a title loan. The title lender will put a lien on the title until your loan has been completely paid off. You can continue to use your vehicle as you normally would.

You may qualify for a title loan even if you weren’t approved for a traditional personal loan due to your credit. Your lender will consider your credit when reviewing your application for a title loan, but credit is only one factor that will determine your eligibility. Other factors, including the value of your vehicle and your ability to repay the loan, also affect your eligibility. Because of this, most credit types are accepted by title lenders.

If you are ready to get the cash you need, apply for a title loan with 1(800)Car-Title® today. It only takes a few minutes to find out if you qualify for a loan and if so, how much you will be able to borrow.

1 Note that borrowing money from friends or family may have some adverse consequences.

2 Not all credit card applications are approved.