Advance Cash Loans

As much as we want to use credit card all the time, there are instances when cash payment is needed. Paying for a broken car, local market vendor, or taxi fare; requires cash. In these times of need, you can find solution in the form of advance cash loans.

What Are Advance Cash Loans?

Advance cash loans are short term loans that can be acquired through your credit card. Contrary to how credit cards are used, however, this type of loan means you get to withdraw a certain amount of cash through using your credit card instead of your debit card.

It is important to note that different banks have different policies when it comes to the maximum amount of cash you can take out. Most cash advances are capped to limit your cash withdrawal. This means you cannot fully depend on advance cash services for huge amounts of cash.

What Are the Risks?

It is wise to ask what the risks are when it comes to taking out advance cash services. Despite its convenience, this type of loan has proven to be one of the most expensive ways of getting quick cash. Compared to regular ATM withdrawal, this method comes with a variety of additional expenses and fees.
One of these fees is the cash advance fee and you have to pay this every time you take out cash. This usually costs about 2-5% of the cash amount. This is the charge you have to pay and this does not include the ATM fees yet, although there are banks that don’t charge ATM fees.

Another cost that you have to consider is the interest that you have to pay. There are two reasons why this is expensive. One reason is the fact that advance cash loans generally have higher interest rates compared to regular credit card charges. Another reason is that this interest starts building up on the first day the cash was taken out. You need to take note that there is no grace period when it comes to this kind of loan. In other words, you have to pay it as soon as possible.

When Should I Take Out Advance Cash Loans?

Given the financial risks, consider getting advance cash loans only in extreme emergencies. If you are purely relying on this loan, the best financial advice for you is to take a hard look at your finances and make the necessary adjustments as soon as possible.

Consider taking other options if you are in dire need of cash. Among your other options include getting a personal loan from a bank, borrowing money from family or friends, or even overdrawing your checking account. The latter means you’ll have to pay for fees, but at least you don’t have to worry about paying the interest.

However, if you do have to take out advance cash loans, make sure you are aware of the charges and how much you need to pay back. Consider if the additional cost is worth paying for whatever you need the urgent cash for.