Tribal installment loans are pricey with high-interest rates and fees that keep borrowers indebted for a long time. Before taking a tribal loan, you should be aware of the other possible avenues open to you. There are many other fairly accessible types of credit to consider before looking at potentially exploitative lenders.

Federal Student Loans

If you require a cash for college or career school, then federal student loans are your best bet. They are provided directly by the federal government and are usually cheaper and come with more favorable repayment terms compared to private loans. Federal student loans are issued without credit check and there is no need to provide collateral. Depending on your financial status, you can be eligible for state funded loans whereby the government pays the interest on the loan while you are still in college.

401(k) Loans 

Sometimes your employer may permit you to borrow against the plan, particularly if you are enrolled in the 401(k) retirement savings plan. 401(k) loans are cheaper than most other personal loans and do not always necessitate a credit check. But do so with a caution that in the event you resign from the job, the loan will be due in full. If the borrower fails to repay the loan on time, there are also consequences in tax laws. However, taking a loan from your 401(k) is considerably cheaper than the high-rate tribal installment loan.

Credit Union Loans

Credit unions are member-oriented, non-profit organizations that frequently offer better service and cheaper interest rates in comparison to commercial banks. If you are a member of a credit union, then first try to check the personal loan offered by the credit union before opting for a tribal installment loan. The interest rates on credit union loans are usually pegged at a maximum of 18% of the annual percentage rate and below. Your credit will still be pulled but credit unions are often more forgiving if your credit is not great.

Payday Alternative Loans

If you are in a position to join a credit union but have not done so, some credit unions offer payday alternative loans (PALs). This is a cheap credit product to which borrowers are supposed to apply instead of turning to dangerous payday credits. PALs have attached to them maximum interest rates of 28% APR, application fees not exceeding $20, and other measures to protect consumers. Before considering a possible high-rate tribal loan, check with credit unions in the area to see if they offer payday alternative loans.

Local Nonprofit Assistance 

Churches, organizations of families with young children, shelters for the homeless, and some nonprofit organizations in your community may provide emergency grants or microloans. It is these programs that are aimed at helping those who are in need of some financial assistance and families in particular. For assistance options in your area, try the online directory at 211. org or Benefits. gov Nonprofit organizations cannot lend to everyone who needs money, but contacting them before accepting a high-rate tribal loan seems to be your only choice. 

Employer Loans/Advances

Many companies are ready to offer a wage increment or a microcredit to workers who have short-term problems. These advances are often repaid through payroll deductions, typically without interest charges. You can also approach your manager or the human resource department and enquire about employee loans or advances. Hence, paying back $100 in a week or even in fragments from multiple paychecks is probably cheaper than obtaining a tribal installment loan.

Hardship Repayment Plans

If you still owe money to a payday lender, a hospital, or a government agency, pick up the phone and tell them about your situation. Most of the creditors are flexible to offer the borrowers to make use of the interest only hardship or reduced payment repayment options. This will not necessarily cancel the amount you owe back, but can help become current on payments without going into more high-rate debt like a tribal loan.

Debt Management Programs

By contacting an accredited credit counseling agency, you have an opportunity to combine all you high interest debts into one manageable monthly payment via debt management program (DMP). DMPs directly negotiate with your creditors, which may result in a reduction in the interest rate and/or the elimination of fees. It is easier for an individual to make one affordable payment instead of making several payments for different debts every month. Free or low-cost is the general rule of nonprofit credit counseling.

Balance Transfer Credit Cards

They refer to credit cards that enable you to transfer debt from a high-rate credit card to the new one, usually for some time with a 0% interest rate. With a balance transfer, you still have to pay off the debt but get to do it at 0% interest for 6-12 months or more with the card. This will assist you to reduce the balance and save on the interest much more than piling up more high-rate debts using a tribal installment loan. If you have average credit score of about 670 and above, then you are likely to get approved.  

Temporary or Part-Time Employment

Riding for Uber or Lyft, delivering food for Doordash or Grubhub, renting out an extra room for Airbnb, or selling items online are some of the ways one can make extra money without applying for financing. Several applications and websites available today help in finding temporary or part-time work in the gig economy. Though not such a quick fix to the problem, side income enables one to discharge prior outstanding loans without incurring in new costly loan ventures.

Negotiate/Settle Large Debts

If you have a higher amount outstanding, such as overdue medical bills, it may be to your advantage to negotiate for a lower amount to be paid in full. Some creditors are willing to accept partial payments instead of waiting to turn the unpaid bills into collections. However, always remember to avoid getting into debt settlement expecting to pay for it by taking another loan, but seek for deals and payment solutions on your own.

In conclusion, it is advisable not to take tribal loans, payday loans, auto title loans, and other identical extremely high-rate debt products. Federal student loans, early withdrawal on retirement programs, credit union loans, employer and nonprofit assistance, using credit card for balance transfers, part-time jobs, negotiating debts and hardship programs are often better than the risky loans from predatory lenders. Of all the financing available, do not opt for any that is being offered at a rate higher than 36% per annum.