What Are Payday Alternative Loans?
Some federal credit unions offer short-term small loans that have a meager application fee (no more than $20) and a lower rate of interest (maximum 28%) as compared to a typical payday loan. These loans are called payday alternative loans (PALs) and are regulated by the National Credit Union Administration (NCUA). Lenders can disburse a loan amount lying between $200 to $1000 and borrowers need to repay it within one to six months.
Is It Possible To Apply For Payday Alternative Loans With Bad Credit?
Credit unions provide PALs to help people financially, not to make profit by lending. Therefore, people with a bad credit score also have a chance of getting this loan. A potential borrower’s overall financial background is evaluated, such as the annual income and the ability to repay.
So, even if you have debt to repay, but you are making payments on time, it will reflect positively when a PAL lender considers your loan. If you are unable to secure a PAL, there are many other types of loans offered by lenders on iPaydayLoans.
How Can I Apply For Payday Alternative Loans?
To apply for a PAL, you first need to identify which credit unions are offering it. After making comparisons and finding the best PAL lender, you need to become their member and wait for one month before you apply. To skip the waiting time, opt for PAL II. You can avail either a payday alternative loan or PAL II (a new kind of loan upto $2000 and 12 month term) but not both - so choose carefully.
If you do not meet the requirements of the credit unions, you can consider iPaydayLoans for other loan choices. Simply provide your information online and we will share it with direct lenders. They will evaluate your circumstances, provide loan offers, and if all goes well, you can receive the money as soon as the next working day.
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What Are The Differences Between Payday Alternative Loans And Payday Loans?
Payday alternative loans are offered by not-for-profit credit unions that exist to provide affordable finance options. In contrast, payday loans are offered by profit-making online lenders, which is why these loans are usually expensive.
Remember that for a PAL, you need to be a credit union’s member but this isn’t required for payday loans. Although easier to qualify for, payday loans often trap the borrower in long-term debt. Whereas, PALs require you to disclose the loan’s purpose and declare any recent bankruptcies so that the lender can determine whether it’s wise for you to take another loan or not.
How To Improve My Credit For Getting Better Offers?
To improve your credit score, begin by paying off any overdue payments. Even though it can take a long time to get it off your record, clearing past-due payments is beneficial in the long run. Reducing your credit card debt may also help improve your credit score.
If you have any ongoing loans, ensure that you’re making timely payments so that you can establish a healthy repayment history against your name. Lastly, make sure that there are no inaccuracies in your credit report, such as payments shown as ‘unpaid’ even though you paid them off a while ago.
Other Options Recommended
If you want money for a specific purpose, there are other loan options worth considering, such as:
Car Title Loans: With a car as collateral, you will easily apply for the loan and access cash to buy something you wish to have.
Installment Loans: Ideal for paying off past-due installments and reducing outstanding debt in one go.
Personal Loans: If you need cash for a medical emergency, funeral, wedding, vacation, or any miscellaneous expenditure, consider a personal loan.
Bad Credit Loans: For individuals having a less-than-perfect credit score, get a loan to meet your needs.
Short Term Loans: Opt for this loan if you do not wish to enter into a long-time commitment.
Quick Loans: The loan amount is usually small for these loans, but processing time is very short.
For all of the above options, iPaydayLoans can act as your trusted broker and connect you with an array of lenders. Get started by submitting your information today!
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Get StartedFAQs
Can I Easily Get Loans At iPaydayLoans?
To get a loan from our lenders other than payday alternative loans, you need to be at least 18 years old and a US citizen with a bank account. You also need to have a stable income and a valid ID.
Will I Get A Payday Alternative Loan With No Bank Account?
A bank account is necessary for getting payday alternative loans as the money is not given out in cash. Moreover, the bank account must exist at a federal credit union because these institutions can give PALs only to their members.
How To Eliminate The Need For A Loan?
To end your cash crunch quickly, you can borrow money from friends or family, ask your employer for a salary advance, or take up an additional job. However, for larger amounts of money, a loan remains ideal.
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