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Getting quick access to cash can be difficult in even the best of times. But COVID-19 has the economy in disarray, many people have yet to receive their relief checks and unemployment money has been tied up in some states.
If you're short on cash, a payday loan may seem like your only option — but there’s rarely a good reason to get one.
Even if it's just a small amount of money to cover an emergency, a payday loan could leave you worse off than before you borrowed.
Here are nine alternatives to consider when you need cash quickly.
1. Check local nonprofits and charities
Best for: Free help to cover essential expenses.
Local funding sources, like community centers and nonprofits, are especially helpful if you’re balancing groceries, gas and other expenses with a new emergency. Some of these organizations can be a resource for donated food, clothing or bus tickets for medical appointments or job interviews.
Check NerdWallet’s database of local alternatives to payday loans to see what’s available in your state.
Speed: How quickly you can get help depends on what you need and which organizations are in your area. Give them a call to find out.
Keep in mind: Charitable organizations may require proof that you need help, like recent pay stubs.
2. Get help with medical bills
Best for: Reducing a large medical bill or making it more manageable to repay.
There are a handful of options that you can try before turning to a payday lender for medical bills.
Payment plans: Ask your doctor’s office if you can set up a payment plan that splits a large bill into smaller monthly payments.
Medical bill advocates: Medical bill advocates negotiate down bills after an expensive procedure or hospital stay. They can also spot costly errors and dispute them.
Medical credit card: Some medical credit cards offered through doctors’ offices have interest-free promotional periods that may help you cover the expense. Card companies may require a credit check.
Speed: Each option varies in speed, but you can set up a payment plan usually with a phone call to your doctor’s office.
Keep in mind: Each of these options comes with a fee, or the potential for one. Calculate the amount you’ll save against the amount you’ll pay in order to make a net-positive decision.
3. Borrow from a credit union
Best for: When you’re in good standing with a credit union and have time to wait a couple of days for a loan approval.
If you’re an existing credit union member, or are eligible to become one, you have a good option already at your disposal.
Credit unions look beyond your credit score and evaluate your standing with the company, your income and credit history to qualify you for a loan.
Some credit unions also offer payday alternative loans, though they’re not very common. If your credit union offers them, you can borrow a small amount — usually up to $1,000 — with a maximum interest rate of 28%, and you’ll have a few months to repay.
Speed: Credit unions, like banks, may take a few days to a week to process your application and fund a loan.
Keep in mind: Credit unions report late and on-time payments to credit bureaus, which will affect your credit score.
4. Apply for a bad-credit loan
Best for: Getting cash when your credit score is below 690 FICO.
Some online lenders tailor their products to bad-credit borrowers. These lenders may approve loan applicants with high debt-to-income ratios and bad to fair credit scores.
If you’re unsure if you’d qualify for a bad-credit loan, you can pre-qualify to see what lenders can offer you. It doesn’t hurt your credit score, and pre-qualifying with multiple lenders allows you to compare loans.
Speed: Many online lenders build fast funding into their product and can deposit the money into your bank account the same or next business day after you’re approved.
Keep in mind: Some lenders have raised their applicant requirements in response to the economic changes caused by COVID-19. Also, online and bank lenders report missed and on-time payments to the credit bureaus, both of which impact your credit score.
» MORE: Compare fast emergency loans
5. Try other ways to make money
Best for: Creating a temporary or permanent side hustle — or finding extra cash where you haven’t looked yet.
You can make some extra money by selling your clothes, driving for a ridesharing company or turning a creative hobby into an online shop.
Some of the options in our guide to making money take longer than others, but many of these jobs can be done alone or from your home.
Speed: How quickly this gets you cash depends on how you choose to make money. Selling things online can take a few hours to a few weeks, while Uber drivers get paid weekly.
Keep in mind: The internet abounds with get-quick-cash scams. Avoid job openings that require you to pay money upfront or ask for personal or financial information.
6. Form a lending circle
Best for: Getting low- or no-interest money, as long as you’re willing to contribute funds to help someone else, too.
You can form a lending circle with a group of people you trust. This is a somewhat long-term commitment because lending circles usually raise money for one person each month. Still, it can help you raise money for something like a car repair, or get you through a tough time.
Depending on whether you use a website to manage your lending circle, and which one you use, they can also help you improve your credit score.
Speed: This depends on when the cycle of payouts reaches you, but it’s among your slower funding options.
Keep in mind: You should have a steady source of income if you’re going to join a lending circle in order to contribute regularly.
7. Borrow from a friend or family member
Best for: Getting money without interest, if you’re close enough with someone to ask.
Asking someone you trust to help cover a bill or spot you a month’s rent won’t hurt your credit score, but it may do a number on your pride.
You and your lender can draw up terms that define when the loan will be repaid and whether you’ll pay it back in installments or all at once.
Speed: This depends on the term you and your lender agree to.
Keep in mind: A loan from a family member or friend doesn’t require physical collateral but you could be putting a relationship in jeopardy, so tread carefully.
8. Use a paycheck advance app
Best for: When you’re employed and need emergency cash.
If you’ve got predictable income and need an advance on it, you can consider a paycheck advance app like Earnin.
These apps usually confirm you have a job and then offer an advance of between roughly $100 and $500 on your next paycheck.
They charge either low or no fees, but they may accept voluntary tipping for the service.
Speed: These apps require you to earn the money before you borrow it. If you request money from Earnin, the app checks to see if you’ve earned enough before lending — a process the company says takes about 10 minutes.
Keep in mind: Paycheck advances are a temporary solution. If you find yourself regularly paying to access money you’ve already earned, you may need to review your budget.
“People should be very wary of services that claim to offer free ways to access money early,” National Consumer Law Center Associate Director Lauren Saunders said via email. “Apps may find ways to make it difficult not to pay tips that are purportedly voluntary, and ‘tips’ can add up just like traditional payday loan fees do.”
9. Consider a pawnshop loan
Best for: Getting cash without a credit check and without having to sell an item.
A pawnshop loan is a no-credit-check option that’s a step shy of actually selling your stuff. To get one, you hand something you own to staffers at a pawnshop, and they assess its value and determine whether they’ll give you a loan in exchange for your item.
You and the pawnshop agree on when you’ll pay off the loan — and any other interest or fees — in order to get your item back.
Speed: A pawnshop will usually tell you on the spot whether it will lend you money and how much.
Keep in mind: Pawn loans may not be much better, cost-wise, than a payday loan. Calculate the loan’s annual percentage rate to be sure you’re not handing something over only to pay back much more than you got.
These loans are also not a long-term solution. If you’re getting in the habit of taking pawn loans regularly, you’ll need another solution.