Oregon best payday loansabril 1, 20220

The Best Alternatives to Payday Loans for College Students Who Need Cash

The Best Alternatives to Payday Loans for College Students Who Need Cash

In an ideal world, all financial problems would be solved with a simple solution: make more money . Obviously, it’s never quite that simple in the real world.

While increasing your income should be part of any long-term strategy when you’re struggling to make ends meet, sometimes you need money right now. In this case, it’s tempting to apply for a payday loan just to keep yourself afloat.

Here’s why you shouldn’t do worldpaydayloans.com/payday-loans-or/ that – and where to look instead. Funding U does not necessarily recommend any specific payday alternatives, but we’ve put together enough information for you to make the decision on your own.

What are payday loans?

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Payday loans are short-term loans, usually around $350, with extremely high interest rates, ranging from 129% APR to 591% APR depending on the state. The average borrower will pay $520 in fees just to borrow $375.

Payday loans are popular because they don’t require a credit check and will accept anyone who has a regular source of income. Unfortunately, most people who take out payday loans can’t repay them immediately and have to renew the loan, triggering another round of fees. Approximately 22% of borrowers renew their payday loans six times or more.

Payday alternative loans

Some credit unions offer payday alternative loans (PAL). These are like a hybrid of personal loans and traditional payday loans.

PALs range between $200 to $1,000 and have a term length between one and six months. Credit unions sometimes charge a $20 application fee. To be eligible for a PAL, you usually must have been a member of the credit union for at least a month.

The maximum interest rate on a PAL is 28%, much lower than a payday loan and similar to a personal loan. Borrowers are limited to taking out three PALs in a six-month period. Read more

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Tax credits you might be eligible to claim

Tax credits you might be eligible to claim

If you do not normally file a federal tax return, you might consider filing this year. Congress continued the federal income tax credit available to students and their families with tuition and other eligible college related expenses.

If you are claimed as a dependent on another person’s (such as your parents) tax return, only the person who claims you as a dependent can claim a credit for your qualified educational expenses.

The American Opportunity tax credit applies to the first four years of your undergraduate studies. You may claim up to $2,500 for this credit if you meet the income requirements and are attending school at least half-time. Even if your income level was not high enough during the year to incur federal income tax liability, up to 40 percent ($1,000) of the tax credit can be received as a refund.

The Lifetime Learning Credit helps parents and students pay for undergraduate, graduate, and continuing education. You check my reference for qualified education expenses depending on your income level.

Depending on your individual circumstances, there are additional tax credits and deductions that may be better for you. For guidance, please consult a tax advisor.

1098-T forms

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Your 1098-T form is available online through MyUW. If you have not opted out of receiving a paper copy, it will be mailed to you during the last week of January. The form will list your tuition and related fees paid in box 1. Any scholarships, fellowships, and grants you received in the prior calendar year will be listed in Box 5. Read more