If you are considering a loan shark, it is because the usual doors feel closed: bad credit, no credit, urgent bills, or a bank that already said no. This page lists the legal options that remain open in exactly that situation, roughly in the order worth trying them.
1. Credit unions, especially payday alternative loans
Credit unions exist to serve members, not shareholders, and many offer small loans to people banks refuse. Federal credit unions can offer payday alternative loans, called PALs, of $200 to $2,000 with rates capped at 28 percent and application fees capped at $20. You typically need to join the credit union, which is often easier than expected based on where you live or work. Find one near you through the NCUA credit union locator.
2. Small dollar loans from banks
Several large banks now offer small dollar loans or paycheck advances to existing customers, often $100 to $1,000 with flat fees far below payday loan costs and approval based on your account history instead of your credit score. If you have a checking account, check the bank’s app before looking anywhere else.
3. Payment plans instead of new debt
If the money is for a bill, the cheapest loan is often no loan. Utility companies offer hardship payment plans, medical providers routinely accept interest-free installments, and landlords often prefer a payment plan to an eviction. Asking costs nothing and does not touch your credit.
4. Help paying essential bills
Money you do not have to spend is money you do not have to borrow. United Way 211 connects you free and confidentially to local programs for rent, utilities, food, and medical costs, and USAGov’s benefits finder shows federal and state programs you may qualify for.
5. Employer options
Some employers offer paycheck advances or hardship funds, and many payroll systems now include earned wage access, which releases pay you have already worked for. Fees are usually modest, though treat frequent use as a warning that the budget needs bigger help.
6. Community lenders and CDFIs
Community development financial institutions specialize in lending to people mainstream finance overlooks, including borrowers with poor credit. Find nearby options through the CDFI Fund. Local nonprofits and religious organizations also run small emergency loan or grant programs in many areas.
7. Borrowing from people you trust, done properly
A loan from family or a friend costs less than any lender, and it goes wrong for predictable reasons: unclear terms and unspoken expectations. Put the amount, schedule, and what happens if a payment is missed in writing, even informally. It protects the relationship as much as the money.
What to avoid
- Anyone unlicensed, whatever they call themselves. Check via NMLS Consumer Access and see how to identify a loan shark.
- Advance fee offers. A legitimate lender never asks for money upfront to release a loan.
- Title loans that risk the car you need for work, and payday loan rollovers that turn two weeks into a year. If a payday loan is genuinely the only legal option, borrow once, small, with a plan to repay on the first due date. See loan sharks vs payday loans.
If you already owe an illegal lender
These alternatives can fund an exit, but check what you legally owe first. Start with how to get out of loan shark debt and the free counselors on our debt help page.
This page is general information, not financial advice. Product availability varies by state and institution. Last reviewed August 2026.