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It’s not always easy to get the financing you need, especially if you’re looking for a traditional loan. Many traditional lenders—like banks and credit unions—have strict eligibility requirements you have to meet before they’ll offer you a loan. Even if you do qualify for a loan, it might not cover what you need. But what about loan alternatives?

There is good news, though. Although traditional loans are convenient, they’re not the only option when you need cash. Sometimes, they’re not even the best option, especially if you need funds now.

Many direct online lenders and fintech companies offer alternative loan options to help with your financing needs. Some of these options come with better terms or rates than what you might find elsewhere, too.

Before you settle on a loan option, here’s what you can expect with a traditional loan, as well as the best alternatives.

Traditional Loan Requirements

A traditional loan is any loan you get from a traditional bank. These loans sometimes come in larger amounts than alternative options, but not always. Most traditional lenders have strict requirements when it comes to things like credit score, credit history, and income. This can make it challenging to qualify for a loan if you have bad credit or limited credit history.

The requirements for a traditional loan vary by lender. However, most lenders do not offer personal bad credit loans. Instead, they typically require borrowers to have the following:

  • 670+ FICO credit score: Some traditional lenders will accept a lower credit score.
  • Established credit history: Two or more years of credit history is recommended.
  • Minimum annual income: This depends on the loan amount and your credit score.
  • 36% maximum debt-to-income ratio: This is how much of your gross monthly income goes toward your debts.

Loan Alternatives to Traditional Lending

If you do not qualify for traditional personal loans for bad credit, you could consider an alternative lending option. This could help you with anything ranging from furniture financing to paying off medical bills.

Alternative financing is any loan or financial product that does not come from a traditional bank. Many online companies offer alternative options, such as installment loans, cash advance apps, peer-to-peer loans, and other bad credit online loans.

These options typically have a simple online loan application process and fast approval and funding times. Some are even instant loans. They may also have fewer requirements, making them ideal for borrowers who don’t qualify for traditional financing.

Alternative lending makes it easier to get the funds you need when you need them. With that in mind, here are the most common alternative loan options to consider.

Salary Advance

A salary advance is when you get a portion of your paycheck early—usually by a few days or so. You can request a salary advance through your employer, but not all employers offer them.

Typically, people use a salary advance when they’re dealing with a financial emergency and need cash fast. These quick loans are convenient and do not require a formal application. Most employers also do not charge additional fees or interest.

Some employers do have specific requirements for this alternative loan option, though. If you’re unsure what they are, ask the Human Resources department at your workplace. They should be able to explain their policies or give you the necessary information.

To get a salary advance, most employers will require you to have a clean work history without any negative marks (like excessive absences). You might also have a higher chance of receiving one if you’ve never requested one and have worked with the company for several years.


  • Higher likelihood of getting approved with minimal to no fees
  • Fast loans for those who need cash now for emergencies or unexpected bills
  • Simple repayment options are often available
  • No credit score requirements


  • You may need to repay the salary advance in installments or receive a smaller paycheck
  • Salary advances typically come in relatively small amounts (like a few hundred dollars)
  • Not all employers offer them
  • Some companies limit how many salary advances you can get or how you can use the funds

Best for

A salary advance is best for borrowers who have a good rapport with their current employer and need the funds to cover an emergency. This could also be a good option for those who need cash quickly but may not have the credit required for a traditional loan.

Before requesting a salary advance, ask yourself:

  • How much do you need to borrow and why?
  • Do you need to repay the amount, or will your employer automatically deduct it from your next paycheck?
  • If your employer deducts the amount from your upcoming paycheck, will you still have enough money to cover future expenses?
  • Does your employer charge administrative fees or interest? The answer is usually no unless you go through a third-party service.

If you do not need money now, but could use some extra cash, consider earning cash on the side instead. One such option is through making money with TikTok videos.

Family and Friend Loan

Asking a friend or family member for a loan can be difficult, but it’s sometimes the best option. If you’re facing a financial crisis outside your control—such as a medical bill or sudden layoff—a loved one might be able to help.

And, asking someone you know for a cash loan could be easier than applying elsewhere. After all, chances are your friend— or family member—will not require a credit check or charge interest. They might also be more lenient about repayment, though it’s best to be upfront about expectations.

Here are a few ways to ensure the process goes as smoothly as possible.

  • Choose the right person. Even if they want to help, it’s usually not a good idea to ask someone for a loan if they’re also strapped for cash. Consider their financial situation before asking for money.
  • Think about how much you need. Figure out exactly how much you need to borrow and why before getting a loan. This can prevent you from borrowing too much, making it difficult to repay the amount later.
  • Be clear about the repayment terms. Relationships can become stressful when money is involved. Avoid this by setting clear repayment terms from the get-go. For example, will you pay in installments? If so, how much will each payment be? Will there be interest? Consider writing everything down so everyone’s on the same page.


  • Flexible repayment options
  • No credit check or formal loan application required
  • No interest or late fees (unless set in writing)
  • Alternative loan amounts vary based on what you need


  • Could hurt your relationship if you’re unable to repay the loan
  • Can be stressful or embarrassing to ask a friend or family member for financial help
  • Not writing out the details can make things like repayment terms confusing

Best for

This alternative loan option may be right for you if you need a no-credit-check loan quickly and have a good relationship with your loved one. They’re also good for avoiding a credit check or formal application.

Cash Advance Apps

A cash advance app is another good alternative to traditional loans, especially if you need an instant loan for a one-time emergency.

The way cash advance apps work is simple. First, you may need to download the app to your smartphone and create an account. Many apps are free, though some come with a monthly service or subscription fee. Some apps also come with an optional tipping feature.

Once you have the app, you can request a small sum from your upcoming paycheck—that is, money you’ve earned but not yet received. Since you’re borrowing money ahead of time, expect your next paycheck to be slightly smaller than usual.

Eligibility requirements for a cash advance are usually minimal. You will need to be at least 18 years old and have a job with direct deposit.

Some cash advance apps let you borrow anywhere from $100 to $750 per pay period. However, there might be a maximum daily withdrawal limit.


  • Usually free or low-cost to use
  • Many apps come with same-day funding
  • Ability to receive cash several days ahead of your next paycheck
  • Lower fees than other alternative or traditional lending options


  • Low borrowing amounts
  • If you overdraw from your account, there could be an overdraft fee
  • Borrowing from your upcoming paycheck could leave you strapped for cash next pay period
  • Using the tipping option could be expensive

Best for

A cash advance app could be helpful if you need money quickly for an emergency. But be aware that your next paycheck will be smaller because of the cash advance. If you’re worried about the smaller paycheck, consider taking out an emergency loan for bad credit with a longer repayment term instead. Or, if you have a 401(k), you could use it as an emergency loan.

Payday Loans

As the name implies, payday loans are small short-term loans that you must repay in full on your next payday. These loans are usually small—no more than $500 in many cases. They also come with an annual percentage rate (APR) of about 400%.

Although payday loans can be expensive, they’re convenient if you need money now and do not qualify for traditional loan options. To qualify, you’ll typically need to:

  • Be at least 18 years of age
  • Have an active bank account
  • Show proof of income
  • Have a Social Security number

Similar to title loans, most lenders do not require a credit score, meaning you can get one even if you have bad credit. You can apply for a bad credit loan online or in person. In many cases, you will receive funds the same day.

Payday loans are not available in all states, so be sure to check what direct lenders are available near you.


  • Quick loans for borrowers with no or limited credit
  • Very few eligibility requirements
  • Same-day approval and funding available
  • Payday loans are unsecured loans, meaning you do not need collateral to get money


  • Financing fees and APR can be high
  • Higher possibility of ending up in a cycle of debt
  • Some payday lenders are not reputable
  • Not available in all states

Best for

Payday loans are best for people who need cash for an emergency and can reliably repay the loan in two to four weeks. Be sure to budget the full cost before taking one out.

Peer-to-Peer Lending

Peer-to-peer (P2P) loans are another alternative loan option. They work similarly to other online loans, like personal loans online, in that they come with certain requirements, terms, and interest rates.

The difference between a P2P loan and a traditional loan is that there’s no middleman involved. Instead, these loans are funded by individual investors who work directly with you on your financing needs.

To get a P2P loan, start by finding a reputable online marketplace (Peerform or Upstart are good options), then apply for a loan and wait for investors to review it. Once you receive an offer, review the terms as usual and accept (or deny) it. As with other loans, like installment loans, you’ll need to start making monthly payments once the loan is funded. These payments will include the principal (original balance) and interest.

Perhaps the most significant advantage of this alternative form of financing is that there are some loans for people with bad credit. In other words, you could qualify even if you have poor credit or limited credit history. This is because each investor sets their rates and requirements.


  • Peer-to-peer lending platforms typically show you the different interest rates and terms available based on your profile
  • Prequalification may be available
  • Easier approval process compared to traditional loan options
  • Loans work for people with bad credit
  • Repayment is often flexible
  • Same-day or next-day funding available


  • Some lenders charge additional fees, such as an origination or prepayment fee
  • No guaranteed approval
  • P2P loans do not always have the same protections as traditional loans
  • Some loans take longer to approve

Best for

A peer-to-peer loan might be right if your limited credit history or bad credit prevents you from qualifying for traditional loans. Many lenders will consider other factors besides credit when determining whether to work with you. This can also increase your approval odds.

Pawnshop Loans

Pawnshops do more than just buy and sell second-hand items. Many of them also offer pawnshop loans.

These short-term loans rarely require a credit check, making them easy to qualify for. All you need to do is exchange a valuable item—such as jewelry or electronics—for some cash. The amount you receive will typically be less than what the item is worth so the pawnshop can still profit if you fail to make payments.

If you repay the loan on time—usually within 30 to 60 days—you can get the item back. This essentially makes a pawnshop loan like other secured personal loans, though you cannot usually get them online.


  • Fast cash loans that do not affect your credit score
  • Can help if you do not qualify for traditional loan options
  • If you pawn off something you do not need, there’s minimal risk to you as the borrower


  • Pawnshop loans often come with interest or other fees, making them potentially expensive
  • Failing to repay the loan could mean losing your item
  • Repayment terms are short—usually no more than two months

Best for

As bad credit loans, pawnshop loans could be ideal if you need cash quickly and have poor credit. These loans are also helpful if you can repay the loan on time and get your item back. Pawnshop loans also bring very low risk, especially if you’re okay with potentially losing your item.

You might want to avoid taking out a pawnshop loan if you qualify for installment loans online or another form of financing. Other common alternatives to pawnshop loans include borrowing from a friend or family member, getting a salary advance, or applying for an installment loan.

Why Jora Credit?

We are a state-licensed, direct lender providing online loans that give you access to the funds you need.
It’s easy to apply right from your phone, laptop or tablet – anywhere, anytime. And it only takes a couple minutes.
There's no application fee, no origination fee, no prepayment fee and no late fees.
Accept your loan by 10:30 am Central time (Monday - Friday excluding holidays) and you can get your funds on the same day.*

Online Lenders

Many online lenders offer direct installment loans to bad credit borrowers. These loans vary widely regarding repayment terms, interest rates, loan amounts, lender’s fees, and borrowing criteria.

Unlike payday loans and other short-term options, installment loans tend to have longer terms, making them easier to manage and pay off over time.

If you’re interested in getting an installment loan through Jora, here’s what you need to know:

  • Simple application process that’s free and completely online
  • Same-day funding if you apply and accept a loan by 10:30 am CT (on a business day)*
  • Loan amounts range from $500 to $4,000 (depending on your state)
  • Long repayment periods customized to your budget
  • No hidden fees
  • All payment history gets reported to the credit bureaus, so you can use the loan to build credit

Interested in learning more about installment loans? Contact us or learn more about how Jora works.


  • Fast funding and approval times
  • Funds may be used for nearly anything
  • Might be easier to qualify for a loan
  • Convenient application process
  • Monthly or bi-weekly installments make it easier to repay the loan over time


  • Some lenders charge additional fees like prepayment or origination fees (note: Jora does not have any hidden fees)
  • Loan amounts depend on the state of residence
  • Not available in all states

Best for

Online options are one of the best loans for bad credit, especially if the borrower is looking for a simple application process and fast funding to cover their financial needs. These loans are also versatile and may come with flexible repayment terms.

Frequently asked questions
We bring honesty and transparency to financial services technology

Jora offers two types of loans, depending on your state of residence – installment loans and lines of credit. To see which type of loan is offered in your state, please view the What it Costs page and select your state.

Jora Credit is the Lender. Jora Credit operates under state specific companies, licenses, and rules for the states that it services. Jora Credit does not lend or arrange loans or lines of credit in all states. Please see What it Costs for the serviced states and applicable terms.

Other Loan Alternatives

It’s not always easy to qualify for traditional financing. But the good news is that you may still be eligible for alternative loan options like installment loans, salary advances, or P2P loans.

Before choosing an alternative loan, compare different lenders’ offers to make sure you select the best one for you. Also, check the lender’s requirements, terms, and rates.

And, if you’re looking for an installment loan or line of credit in your state, apply with Jora today.