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Ask Yourself: Do I Have Other Credit Options?
How to Know What Other Credit Options Do You Have?
Payday loans are by definition short-term, high interest, and high-cost loans. There are other options available depending on the type of expense, the kind of debt you already have and your credit score.
If You Have Good to Excellent Credit and no Long-Term Debt
Consider a cash balance transfer card or other types of 0% APR credit cards. If you need the cash immediately, there are companies that will ship you a card overnight (if you cover the extra mailing fees).
If You Have Average or Better Credit and With no or Existing Long-Term Debt
Many traditional banks, credit unions, and online companies provide personal loans to borrowers with average or better credit and with no or existing long-term debt, including Prosper, Lending Club, and OneMain.
If You Have Existing Long-Term Debt and Poor to Bad Credit
An alternative credit option is a PAL (or Payday Alternative Loan), which is a small-dollar loan ($200-$1,000) from a federal credit union. You must plan to use this option because you must be a member of the credit union for at least a month before you apply for a PAL.
With personal loans and payday loan alternatives, you’ll be able to make smaller payments over more time instead of paying back the entire loan by your next payday — which should help improve your credit score as you pay down your debt.