Payday loans are the worst. Twelve million Americans a year turn to them for short-term financial help. But instead of being a quick fix, they can drag you into a cycle of debt with interest rates of 300% to 400%.
No way! Get out of here with that!
But we understand. Sometimes you find yourself without a lot of alternatives. When you’re really in a bind and need the help, there’s a way to get the money you need to hold you over without turning to payday loans. There’s an alternative — one that’s less expensive, easier to repay and helps build your credit.
Possible Finance is a free app that will lend you up to $500 — without even doing a credit check. You can apply in under a minute on its mobile app. If you’re approved, you get your money pretty much instantly.
How to Get up to a $500 Loan Instantly
Possible Finance offers what’s called a short-term installment loan. It still comes with interest, but it’s much cheaper than the kind of predatory payday loan that you’d get at your local check-cashing place.
Instead of having to repay the entire loan by your next payday, you can repay it in several installments over a two-month period. Typically, you make payments every two weeks, and you make four payments in total. You could use manageable chunks from your next four paychecks to pay back the loan. That’s way easier and less stressful.
Possible Finance also lets you reschedule your payment date up to 30 days after the original payment date — with no fees or late-payment penalties. This gives you some extra flexibility.
And you can do the whole thing from your phone. If you’re short on cash and you need money right away and you’ve exhausted your other options, this could be an easy option for you.
So let’s take a closer look at the details.
Build Your Credit As You Repay
Unlike with a payday loan, your repayments to Possible Finance get reported to the three major credit agencies — Experian, Equifax and TransUnion. That can help you build your credit rating — or rebuild it if your credit isn’t great.
Just download its app, go through a few steps and apply for a loan right through the app. No credit check needed. Instead, Possible will ask you to link a bank account and will use your transaction history to see how likely you are to repay the loan. This can be a lifesaver if you’re in a financial bind.
What You’ll Pay in Interest
Your exact interest rate will depend on which state you live in. But Possible says many of its loans have an APR (annual percentage rate) of about 150% — about half of a traditional payday loan.
Here’s what that looks like in real life:
- You borrow $200.
- Over the next eight weeks, you make four biweekly payments of $57.50 each.
- When you’re done, you’ve paid a total of $230.
- That amounts to an APR of 151%.
So there’s a cost, like with any loan. Of course, if you need that $200 in a pinch to help make your rent or avoid a hefty late fee of some kind, you may decide the cost is worth it.
It’s possible that you could get a cheaper loan from somewhere else, from a traditional lender. But that typically takes more time and requires a credit check. For a lot of people, that’s not really an option.
In any case, Possible Finance’s customers seem satisfied. The app is getting good reviews.
It has an “A” rating of 4.8 out of 5 in the Apple App Store, with 12,700 user ratings. On Google Play, it scores a 4.2 out of 5, with 2,750 user ratings.
Possible Finance is licensed in Florida, Idaho, Ohio, Texas, Utah and Washington, and will soon expand to California, Illinois and Wisconsin. It plans to expand further. In the meantime, it’s adding customers in other states to a wait list.
A Better Payday Loan Alternative
So if you find yourself in a pinch — unable to pay rent or buy your groceries, and you’ve exhausted your other options, don’t turn to a payday loan. Many people end up trapped in that cycle of debt.
Instead, use a more flexible option, like Possible Finance. The interest rate is much lower, you get longer to repay it, and it helps you build your credit as you do.
Use its app to see what kind of loan you qualify for.
Now there’s a better way.
Loan amounts from Possible Finance vary based on eligibility and APRs vary by state.
Mike Brassfield ([email protected]) is a senior writer at The Penny Hoarder. He knows what it’s like to be short of cash.