There are times that we all find ourselves in times of financial difficulty and it can be very tempting to turn to the payday loan as a quick fix. However, whilst this type of loan is very handy and super quick to process, they often come with extremely high-interest rates.
If you are looking at borrowing money for something in the immediate future, there are much better and more financially healthy ways to do this. Just take a look at NowLoan for example, where you can compare tons of financial products, finding the best one for you, thus avoiding the hefty cost of a payday loan.
What Are The Alternatives To Payday Loans?
Most people immediately think of a payday loan when it comes to a quick cash advance, but there are other ways in which you can access money quickly, without the huge price tag.
Community Development Finance Institutions
This is an option that a lot of people are not aware of but these community development finance institutions or CDFI's as they are more commonly known can be a real lifesaver for anyone who has been refused credit elsewhere.
They are normally run by local organisations and one of the most favourable points is that any profit that is made from the loans is pumped back into the local community. So taking a loan from them doesn't just benefit you, it will benefit your local area too!
If you are currently claiming benefits from the government, there are schemes in place that can offer loans for a variety of reasons. As with any other sort of loan, you will need to pay it back and this often comes as a reduction in your benefits as a way of repaying.
If you already have a credit card or if you can successfully apply for one then this is often a much safer option than taking out a payday loan. The main reason for this is that a payday loan usually has to be repaid within a very short period of time and this can often mean that you find yourself back where you started financially after paying the loan back. However, a credit card can be repaid over a much longer period and can, therefore, be much more effective in getting you where you need to be financed without a large one-time bill at the end.
When you take a loan out from a credit union, the rate of interest will always be much lower since they are not legally allowed to charge over 3%, making this an attractive offer for anyone who is struggling with money.
Use Your Overdraft
Using an overdraft on your bank account can work in a similar way to using a credit card you will have much longer to pay the sum back meaning that you will not be confronted by a large, one-time payment a short way down the road after taking out your loan.
Many people will turn instantly to a payday loan when looking for a quick financial fix but this isn't always the best way. Payday loans can be dangerous as they must be repaid quickly and at a high rate of interest. This means that people are often left worse off financially in the long run. There are plenty of alternatives such as credit cards or overdrafts, and if you are looking for these kinds of products you might want to make use of a service such as NowLoan. Using a service like this will ensure that you always get a good deal on financial products by comparing them to find the best one for you.