Payday Loans – What are my alternatives?

For urgent car repairs

If you have budgeted too carefully and have not saved for emergencies, an urgent car repair can catch you off guard. But do you really need payday loan help? Maybe there is a cheaper alternative?

1. Firstly, can the expense really not wait until payday? Is it really so bad to take the bus to work instead of driving?
2. Can friends or family help you out with the money until payday? You can even offer to pay them a bit more back – it will still not nearly come up to as much as what a payday loan will cost. Just remember, family and friends are more important than money, so don’t let your little debt come between you – make sure of this by paying them back on time.
3. Can you claim insurance? If you succeed, the insurance company may even replace your car until the car is fixed. The insurance claiming process can be complicated, so you may need to seek advice if it’s your first time.

In some cases, a payday loan can help you get through a short term money problem. With Cashfloat’s instalment loans, you can repay the sum in smaller amounts to help reduce the blow of the unexpected expense.

To pay for urgent medical bills

Taking a payday loan when faced with an emergency medical bill could be tempting, but are there other ways?

1. Check your health insurance and NHS cover. It could be that you can claim most of the expense back. If so, showing proof of this to a family/friend can help you secure the funds without either of you worrying.
2. Depending on the situation, you may be entitled to help from charity organizations. Turn2Us provides financial aid for a range of emergency medical situations.
3. Friends and family are there for a reason. If you ask them for help, make sure to do it properly and pay them back on time to avoid any future uncomfortable situations.

In some cases, a payday loan could help you pay off a medical bill unscathed which gives you time to take the measures to ensure it doesn’t happen again. Just keep in mind that online payday loans should never be used as a solution to a long term problem.

To pay off overdraft fees

Before turning to payday loans, consider other ways to pay off your overdraft fees.

1. Firstly, call your bank! The high cost of overdraft fees have been in the news a lot lately, and many banks have been known to just refund you the charges. If you explain that it was a mistake and that you cannot afford another expense, they may just let it slide.
2. Withdrawing from your savings could be the most efficient way to deal with overdraft fees. In future, consider setting up an arranged overdraft to reduce the penalty of using your overdraft in the future.
3. All credit providers are obligated to treat you with care and respect, including your bank. If you are having trouble, seek free debt advice to learn your rights.

In some cases, such as when payday is just a few days away, taking a flexible payday loan can be the right solution. And with a lender like Cashfloat, you can pay the loan a few days later and only pay the interest of the days you had the loan, costing you just a small amount of money.

To fix or replace home appliances

When an appliance breaks, no need to panic – taking a cash loan online is not the only solution.

1. First of all, can you repair it yourself? Check online – you’d be surprised what useful tips people have to share – even on Youtube, where you are shown exactly what you need to do.
2. If you have an emergency fund, this constitutes as an emergency. Use the money and start paying the fund back at the first chance you get.
3. Is an overdraft or credit card cheaper than a payday loan? Evaluate the costs of all types of credit on pen and paper and pursue the cheapest option.

If you are really stuck, your only option may be to turn to payday loan companies. If so, make sure you get a good deal! Make sure repayments are manageable and there is no early repayment fee, should you suddenly come into some money (hello tax returns!)

To pay your rent

Using a payday loan regularly to pay your rent is a terrible idea. Here’s what you can do instead:

1. Talk to your landlord! They are likely to understand. Together, you can reach an agreement that works well for both of you.
2. If you’re paying a mortgage, your house could be at risk! Speak to your lender immediately and explain the situation. They are obligated to treat you fairly and give you every chance to come to a mutual agreement.
3. There are many free organisations that can advise you. They are trained to deal with situations just like these. Contact one of them before applying for a payday loan online.

Not being able to pay your rent can be stressful. As a one off, taking out a pay day loan could help you get through the tough weeks and may even be just the trick to get you back on your feet. Just be careful to make an informed decision.

For paying your utility bills

If you are behind on your utility bills, a payday loan could put you in a worse position. Maybe there is a viable payday loan alternative:

1. First, call your utility provider. They are professionals at dealing with this, and should be trained to help you. Ignoring letters or warnings will just lead to your supply being cut off in a final attempt for the utility provider to convince you to contact them.
2. Have a look at your finances. Is there any place you can free up money to pay off the bills without going into further debt?
3. Consider switching to a prepaid meter. By doing this, you will learn to allow paying the utility bills to take precedence over other expenses.

Using a HCST loans to pay utility bills regularly is very dangerous and can lead to your debt spinning out of control. But as a one off, using a short term payday loan to pay the bills can be a viable solution.

Going on holiday

In most cases, paying for a holiday is not really a good reason to take a payday loan. Maybe you can:

1. Take a 0% interest credit card. The offer will expire eventually, but hopefully not before you are back home safely.
2. Could an overdraft be cheaper?. Weigh out the costs of each form of borrowing to make an informed decision.
3. Maybe try a wage advance! Some employers will agree to give you a pay advance before the holiday period. Doesn’t hurt to ask!

In future, plan holidays well in advance. This will save you on flights, accommodation and a lot of stress!

If you have not managed to get your finances in order in time, consider cheaper holiday options. If you still need a loan from a payday lender, make sure that you will able to repay it on time, or I could wind up a lot more expensive than you thought.

Shopping for clothes

Shopping can be a very liberating experience. But if you don’t actually need anything, it could just land you in debt.

1. Firstly, stop. Do you really need this? Or do you just want it? Defining needs and wants will help you to priorities what is worth going into debt for and what is not.
2. Learn to spend only when you can afford it. If you don’t have the money, you can’t buy it. Yes, even if it’s on sale!
3. Have you caught sight of an item that tickles your fancy? Eventually, most things go on sale. Some retail sites will even let you sign up and set up an alert for a certain item. Waiting is hard, and you do run the risk of losing it, but you could also save a lot of money.

Expensive products don’t come with a quality guarantee. Very often, you can find very good products that are far less expensive than a similar product by a branded company. You’ll never know if you don’t try!

Hopefully, you can avoid taking payday loans for shopping. If you are totally in love with something that can’t wait, it may be OK to use a short term credit facility as long as you know that the money will be coming in and that this does not happen a lot.

To pay off another payday loan

The golden rule of payday loans is that they should never be used to pay another payday loan. This rule should scarcely be broken.

1. Contact your lender ASAP if you can’t repay your payday loan. They are obligated to help you out and help you come to a suitable arrangement. If you want to be safe and cancel your CPA, do this with your bank as well as your lender.
2. Contact free debt advice if your lender is not cooperating. Reminder: There are fantastic free debt advice services. There should never really be a reason to pay for one.
3. Start setting money aside. Payday loan debt can easily spiral out of control, so you should aim to pay it back as fast as possible for minimum penalties.

Avoid borrowing a payday loan to pay off another at all costs. Contacting your lender to admit you cannot repay your loan can be hard, but it is the best way. If you want, you could try email/sms instead of calling. This could be easier.