What Are Some Payday Loan Alternatives?

Many people enjoy the benefit of payday loans. But it’s important to remember that there are other loans available. Being aware of the payday loan alternatives can help you make the best decision for your unique situation. Payday loans are fast and easy to get, but you can only borrow small amounts and you need to present proof of employment in the form of a pay stub. So, depending on your financial emergency, you may need to look at payday loan alternatives.

When Should You Look At Other Payday Loan Alternatives?

• You have to raise a lot of money. Payday loan amounts typically fall between $100 to $1,000. This may be enough for a few household bills or simple repairs and medical treatments, but many financial emergencies can reach thousands of dollars.
• You can’t present a pay stub. You may be unemployed, or you have a job but you don’t have formal documents like a pay stub or letter of employment. For example, you may be a freelancer or part-time worker, or you run an informal home business.
• You don’t have a checking account. Most payday loans require a checking account in your name, so you can issue a post-dated check to pay off the loan. If you don’t have one and don’t have the time to open one, then you need to look for payday loan alternatives.

Fortunately, there are other loans that are just as easy and convenient as payday loans but are more suited to your situation.

Payday Loan Alternatives

Car Title Loans

If you own a car or truck, then you can use the vehicle title as collateral for a loan. You can borrow up to $15,000 depending on the kind of vehicle you have, its age and mileage, and its current condition.

You can get car title loans even if you have bad credit, and you don’t need to present any proof of employment. The most important requirement is the vehicle title: it has to be registered under your name, and it should be lien-free. That means that it’s not being used as collateral for other loans, and nobody else has any legal claims on it.

Advantages

• You can borrow higher amounts. Among all the payday loan alternatives, car title loans have the highest maximum loan limit. You’ll find out how much you qualify for during the vehicle inspection when the loan representative checks the car’s model and overall condition.
• You can still use your car during the loan. You don’t have to give up your car while you’re paying off the loan. Instead, a lien or legal claim is placed on the title. Once you’re done with all the payments, the lien is lifted.
• You don’t have to meet credit or employment criteria. While banks offer personal loans with fairly large amounts, they require a minimum credit score of 560 or higher, and they will thoroughly check your employment history and average income. In contrast, you can get car title loans just by being the owner of a vehicle with a lien-free title.

Disadvantages

You can only get a car title loan if you already own the car outright. If you’re still paying off your car loan, you can’t qualify because the bank still has a lien or legal claim over the title.

Car Registration Loans

If you’re still paying off your car loan, or you’re just leasing your car, then you have the option to get car registration loans instead. You can borrow up to $1,500, depending on your vehicle’s model and condition.

This loan is just as easy to get as a payday loan and a title loan, but it does require a few more documents. You need to show the motor vehicle registration that is in your name, a government-issued ID like a driver’s license, your social security number, and a checking account that is in your name.

However, if you already have those items, then car registration loans are an easy way to raise emergency cash even if you have bad credit.

Advantages

• You can get approved even if you’re still paying off the car loan. At least you have more payday loan alternatives, even if you don’t own your car outright.
• You can still use your car during the loan. You don’t surrender the car. Instead, a lien is placed on the car registration and lifted after you pay off the loan.
• You don’t have to meet credit or employment criteria. The only requirement is that the car loan and the car registration are under your name.

Disadvantages

• It has smaller loan amounts than title loans. The maximum loan limit is $1,500. However, this is still larger than what you can get with payday loans.
• You need a checking account. The account has to be active and under your name.

Get Payday Loan Alternatives Now

With Southwest Title Loans, you can get title loans or registration loans in just one or two days. Just fill out the online form, and our loan representative will immediately call you back to assist you with the application process.

After the call, you just have to go to the branch to show documents and get the vehicle inspection. You’ll be done in 30 minutes and walk away with your cash and your car.

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.