Can Alternative Payday Loans Save Those with Really Bad Credit Score?

EPF September 9, 2020

Do you know that even if you are with really really really bad credit, payday loans are NOT the last option for you to get a loan? No no, don’t go with payday loans! Payday loans are very expensive, lead people to debt cycle and are predatory. There are many other options. Let us show you…

First of all, it’s a big myth that personal loan companies don’t approve people with bad credit. In fact there are many personal loan companies that approve people with bad credit.

Second, even if you can’t get approved on a personal loan, there are other options called alternative payday loans. These loans are more expensive than traditional payday loans, but times less expensive than traditional payday loans, AND approve people with really bad credit!

What are alternative payday loans, how they work, when should you use them and when not, are they predatory, are they legit?

Quick facts about alternative payday loans:

  • They are times more cheaper than traditional payday loans.
  • They approve people with really bad credit… very fast and easy.
  • They can help people who already have payday loans to refinance them in something significantly better.
  • At last, many people don’t know much about them, and don’t use them as alternative to predatory payday loans, which lead them to paying a lot of money or lead them to debt cycle.

Let’s start from the last point…

Everyday, we at ElitePersonalFinance receive so many questions from people with bad credit.

Our personal analysis show that over 70% of the people who ended up with super expensive payday loans, had better options. Some of these people could quality for personal loans, other for alternative payday loans.

People still don’t understand that, even if they are with bad credit, they have many options, better than payday loans. That’s why we decided to put clarity on that topic.

You will save a lot of money …

What are Alternative Payday Loans?

First of all, don’t worry because you see the term “payday loans”. Actually alternative payday loans are totally different types of loans from alternative payday loans.

Now, to understand alternative payday loans correctly, you have to understand personal loans and what are payday loans before that.

What are Personal Loans?

Personal loans are relatively large amount of loans, but could be lower amount. The amount vary between $500 and in some cases it could be up to $100,000.

These loans can be set to be repaid on installments, picked by the borrower. Terms could be from few months to 10 years for large amounts.

Their APR vary between 5.99% to 35.99%. People with good credit receive loans that are close to the lower limit. However those with bad credit receive more expensive loans close to the highest limit.

Myth! If I’m with bad credit I can’t get a personal loan. That’s NOT true. These days people with bad credit can qualify for a personal loan.


35.99% is a standard that every legit personal loan company obey. If a lender offer you a personal loan with APR higher than 35.99% (actually there are many lenders that do so), then it would be questionable whether we can call it a personal loan!!!

Misinterpreting the loan terminology … you will see that many times in the lending business.

In fact many lenders in the loan business try to mis interpret the terminology. It works …

Now, What are Payday Loans?

Payday loans are short term loans, typically paid in one time, on the next pay day when you get salary for example. These loans are very expensive. Their average APR according to Consumer Financial Protection Bureau is 400%.

They offer typically up to $500 to $1,000.

Payday loans often lead to debt cycle.

Payday loans are illegal in many states, in some they are legal but highly regulated. Link to payday loan laws by state below in the description.

Payday loans serve those with really bad credit, who can’t qualify for other types of loans.

Payday loans are predatory.

We at ElitePersonalFinance highly recommend that people avoid them and there are few really good reasons for that …

  • They are very expensive and often lead people to debt cycle.
  • And, there are many better options for people with bad credit available.

Alternative Payday Loans

Now, let’s talk about these types of loans.

As you can see the gap between personal loans and payday loans is huge.

And this gap is filled by relatively new types of loans that entered the stage few years ago. We call them alternative payday loans.

Think on alternative payday loans as everything that is between personal loans and payday loans.

Before giving you more details on them we have to say that these are different companies that work with different rules. So, there is no exact definition on them.

But, here is what we can say about them overall.

First of all and most important is that they serve people with really bad credit.

They are more expensive than personal loans, but they are times more cheaper than traditional payday loans. This makes them more attractive for many people with really bad credit.

The amount that they offer is typically from $100 to $5,000.

These loans allow people to be repaid on installments, which decrease the chance of getting into debt cycle.

Who These Companies are?

OppLoans, LendUp, NetCredit, RiseCredit. Probably you’ve heard some of them. But there are more. In fact the alternative payday loan business grow. There is big competition between these companies, which make this type of market always improve, which work for us. There are always new companies with better terms that enter the stage. ElitePersonalFinance carefully monitor them and we update you with the latest on our loan shopping center.

Check the link in the description to find always the best alternative loans.

Advantages of alternative payday loans.

Alternative payday loans, really try to differentiate them from predatory, so they have many other features. These features vary by companies, but here are few of the most important that people have to know.

  • They are more flexible. Some of them allow skip of a monthly payment, even without a call, only with a click of online button.
  • They help you build your credit. People who work with them on building their credit and pay their monthly on time, receive discounts and better offers.
  • They report your payment history to credit bureaus, which help you build credit.
  • Very fast approval.
  • Most of them don’t even check your credit score. However, they require a proof of income.
  • They will allow you to make changes in the loan payment plan.
  • Less additional and hidden fees.

However there are disadvantages of alternative payday loans.

  • Much more expensive than traditional personal loans.
  • They don’t offer loans higher than $5,000. Also, not all people can apply for this amount.
  • They operate in fewer states.

Now, many people ask us, whether we recommend alternative payday loans.

Well, yes and no.

We don’t want to mislead people. Alternative payday loans are expensive and that is why we can’t mainly recommend them.

It’s a fact that many big legit personal finance blogs like NerdWallet, Financer, WalletHub, Bankrate, USNews actually started to review these types of companies, although most of them totally ban traditional payday loans.

But all of them give advice like use them only if there are no other options.

Our advice won’t be different.

But …

There is a catch !

Are you actually sure that there really are no other options? Many people think that they are sure but they are not right.

We see people scammed by payday loans every day, thinking that they had no other options, in fact that they had!!!

So, next let’s give you our guide on:

When People Should Get Them and When to Avoid Alternative Payday Loans?

The brief answer to this question is easy and obvious. Use them the way that their name says – alternative to payday loans. Actually … use them only if you have no other options.

However the problem is that most people don’t know about these options. Many people think that they have tried all other things, but they are wrong.

People typically try few things, then get denied then most of them get manipulated that there are no other options than payday loans and they end up with them.

We at ElitePersonalFinance every day speak with people with bad credit. According to our personal opinion over 70% of the people who have ended up with payday loans, had other options. But they haven’t at least tried them …

Really, there are so many things that you can do guys before going with payday loans.

Tip number one that we always give to people with bad credit is to wait and work on their credit score till it improve. People with good credit have so many great offers for loans. Banks, credit unions, online lenders are available to them.

However, improving credit score is not a fast process. And this don’t work for many people, who can’t wait.

There are so many types of loans that work for people with bad credit guys. If you are with bad credit, you will pay more interest rates, but the numbers will be times more better than these 400% APR on a payday loans.

Personal loans for bad credit are available. Shop around. Try all of them. Why not? You lost nothing. It’s free and your credit score We have listed them on our loans shopping center. Link below.

Credit unions. Credit unions offer loans for people with bad credit capped at 18%. Many credit unions offer payday loan alternative, typically up to $500 to $1,000, capped at 28%. Still times more better than payday loans. ElitePersonalFinance have list of all credit unions by state. Link below. Try all of them.

Secured loans and cosigner loans. If you have these options, things can change for you.

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