Personal loans are probably the most popular and common type of loan you see on the market these days. It’s completely understandable since it’s accessible and more lenient compared to traditional loans. But, while it’s convenient, personal loans are not exactly the cheapest out there. This is especially true if you have a less than stellar credit score.

If this pushes you into looking for alternatives, luckily for you, there are several options. However, these alternatives are highly situational, so pick them at your discretion. If you want to know some alternatives to personal loans, then read on.

Credit Cards

One thing about credit cards is that there are a lot of opportunities for the cardholder to save money. From reward points to grace periods, saving money is like second nature to credit cards. But first, what is a credit card, and how does it work?

A credit card is a physical card used in most stores nowadays. It can be used to make purchases, pay bills, etc., if you don’t have cash on hand.

When you open a credit card account, the card issuer will issue you a credit limit you can use whenever you want to spend money. Depending on the amount of money you spend, your credit limit will decrease accordingly until you repay your balance, usually by the end of the month.

However, there’s a “grace period,” which is a timeframe where you can pay off your entire balance for the month in full and without interest before the due date is up. You’ll be charged with interest if you fail to do this.

However, if you have a card policy that gives you a set limit separately each month, grace periods don’t apply, and you will be paying interest. Regarding the APR, it usually depends on the policy you got for your credit card, but typically, it involves your interest rate and other fees that your credit card might have.


An overdraft is an event when there isn’t money left in your bank account to finish a transaction or withdrawal, but the bank still allows it anyway. Essentially, it works as an extension for your bank account that allows you to get money. But of course, there’s a catch since you’ll be charged an interest and fee every time you get an overdraft, which is usually $35.

Often, the interest on overdraft loans is much lower than that of credit cards or even some types of personal loans. This is because an overdraft loan is usually short-term. However, there are some things you should take note of before applying for an overdraft. Sometimes, the bank will allow you to connect an overdraft loan to a credit card.

If you don’t pay the loan, your bank will turn your debt over to a collection agency. With this action, a report will be given to credit agencies. And, of course, this will affect your credit score.

Credit Union Loans

Credit union loans, as the name suggests, come from credit unions. Credit unions are community-based institutions that promote the financial well-being of their members.

Unlike traditional banks and lenders, credit unions are made by the members, which means that they don’t exist solely to make a profit. However, they have loan products and services like those you usually see in banks, like access to personal loans, credit cards, ATM services, etc.

Usually, credit unions only allow people to apply to join their credit union when they have a common attribute with the institution. For example, before joining, you have to be in the same HOA, PTA, church, or even social club in some instances. So why should you join a credit union?

For the most part, if you want to have an affordable loan, interest rates are often lower in credit unions. Not only that, but you can also negotiate if you want to. Also, they have more forgiving qualifications for all loans, especially when you have been a credit union member for a long time.

Even if you have a bad credit score or just starting to build yourself one, it’s usually no problem. In short, credit unions have a slight advantage over most banks and are a good alternative to Zocaloans.

Final Words

Personal loans are very convenient and easy to get. However, they are not the cheapest, especially when you have a bad credit score. Luckily, there are several alternative options you can opt for if you don’t want to deal with personal loans.

Although, if you still want a personal loan that is far easier to get, you can get one from your local credit union if you’re a member of one. If you want more purchasing power, try credit cards, or if your bank allows it, you can apply for an overdraft. There are many more options; all you have to do is look.

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