The 6 BEST Payday Loan Alternatives - YouTube

Pay day loans are the fastest way to make sure you’ll never have money in your bank

account and always be stuck in a miserable cycle of debt. Hey everyone this is Cody with

Rentreporters and today we’ll over the best alternatives to payday loans. First, Im sure

you’ve heard that payday loans are bad, but why exactly are they so bad? And if you

need to skip this, go ahead and skip to the time stamp on the screen to just get into

the best alternatives. Payday loans are generally issued to people who have bad credit, no credit

or to those without any savings in their bank account and they are very short term loans,

generally only a couple of weeks, hence the name Payday loans, because you’ll get paid

in a couple weeks and pay it back. Usually youre required to write them a post dated

check that they’ll automatically deposit and draft from your account when the loan

is due. Now here’s where they get you. Let’s say your loan is $500, maybe you had to go

to the doctors, or your car needed a repair. They’ll give you a loan and charge you $75,

bringing your total to $575 that you owe in just a couple weeks. If that interest amount

was spread out over a year, that’s only 15% which isnt bad when you have low credit.

But when you have to pay that back in only two weeks, that’s close to 300% that you

pay in interest. And if you’re really tight on money, which is the target market for these

companies, you might not have an extra $75 in your budget when the bill is due, and you

end up needing to take out another loan to get you by in just a couple weeks, and the

brutal cycle continues. Alright, so now that we’ve covered why pay day loans are horrible,

let’s talk about the best alternatives. Up first, try to get some bank and credit

card fees refunded by using the Cushion app. Cushion is an app that scans your bank account

and looks for bank and credit card fees. According to them, most people pay $300 more in fees

than they expect and if cushion finds any of these fees, the app will automatically

begin a negotiation process to get the fees refunded. Literally all you need to do is

connect your accounts to the app and it’ll take it from there. They claim to have refunded

over nine million dollars in fees. If you can get a couple hundred dollars in fees refunded,

that’s a couple hundred dollars in high interest loans you dont need to take out.

Up next, get an advance on your paycheck using the Earnin app. Earnin’s tag line is, you

worked today so get paid today. They’ll advance you a portion of your paycheck, up

to a maximum of $500 before you get paid on your payday. They’ll also give you a cash

advance on your full paycheck up to two days sooner, which we’ll cover in more detail

next. The nice thing about this app is that they dont charge interest or fees, although

they will highly encourage you to tip them what you think is fair. To qualify you need

to have at least 50% of your paycheck direct deposited into a bank checking account, paid

on a regular schedule--weekly, bi weekly, monthly--and a fixed work location. If youre

a freelancer or gig worker, unfortunately this wont work for you, at least not right

now. But if you qualify, this can be a low or no cost way to get you the cash you need

for unexpected emergencies. One word of caution though, it’s very easy to become dependent

on apps like this, where you just keep getting advances on your paychecks and paying a small

tip to access your own money before you;’ve even received it. Earnin can be a great financial

tool to help deal with emergency expenses, but you should never fall into the habit of

using apps like Earnin just so you can spend money faster on unnecessary purchases. Before

we go any further, if you’re finding this helpful be sure to hit that thumbs up button

and subscribe to our channel. Youll help us reach more people who need help and we’d

all really appreciate it. Hit the little bell icon too, it’s a lot of fun and you;ll get

notifications when we post new videos every week. Next, get paid sooner with companies

like Empower, Wealthfront, Chime, or Axos. These companies all have their own unique

set of features, but the core idea is that they’ll let you access your paycheck up

to two days in advance, without any fees. If your money emergency doesnt need to be

paid right now right now, using a bank that provides early access to your paycheck if

using direct deposit can be really helpful and save you a ton of money that you would

normally pay with a payday loan. If your money emergency CANT wait, then takes us to...Get

a cash advance with apps like Dave, Brigit, Flexwage and Moneylion. These apps will advance

you money, usually around 200 to 300 dollars, at no cost and they wont even ask you for

tips. One of the standouts here is Flexwage which will actually issue you a reloadable

debit card which makes it a good solution for those who dont use banks or dont have

direct deposit. Number five, use Gofundme or indigogo. Some people might feel wrong

about taking money from strangers on these platforms, but the truth is, the people on

these platforms truly genuinely want to help out. There’s no shame in asking for help

when you really need it, and when you keep your donors updated on your progress, showing

them that their donations helped you out they’ll feel good. Most people genuinely want to help

others out and taking some money from someone able to and willing to share with you is a

far better option than going into a never ending cycle of debt with payday loans. Up

next, why go through all of the work of setting up an app when you can always try asking if

there’s a payment plan available? Now obviously this only works in certain situations like

with medical bills, dental bills, car repairs, but if youre in that type of situation, just

asking about a payment plan can save you a lot of time and money. Most hospitals and

dentists are happy to do payment plans and some even offer their own free or low interest

lines of credit that you can use which will also help build your credit as you pay it

back. Car shops may be willing to work out a deal with you on a payment plan if you leave

some type of collateral with them until the bill is paid. Sometimes just asking for help

can go a long way. And finally, if none of these options work, if you dont have friends

or family that can lend you money, and your banks wont help you out, you can try to get

a personal loan from a peer to peer or online lender. There’s a lot of loan platforms

out there like lending tree, lending club, prosper, upstart, best egg, one main financial….

The list goes on. There are so many different online lenders and they typically have far

lower credit score requirements than regular banks. One main financial doesnt even have

a minimum credit score requirement and Upstart is just 580. You’ll likely pay somewhere

around 30% in interest if your score is bad, but the loan can be paid back over the course

of multiple years instead of a couple weeks which is way less strain on your wallet so

you dont need to go back for another loan. Plus, you can always pay off 3 year loan in

3 months without any problems, you can never take 3 years to pay off a 3 week pay day loan

without problems. And that’s it for today everyone, if there’s any other alternatives

that I missed, make sure to leave those in the comments below. Until next time, this

is Cody with rentreporters and I will see you in our next video.