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All You Need To Know About Cash Advance

By Charlotte

A cash advance is a service available to holders of credit cards and charge cards. The service permits cardholders to withdraw money, either through an Automated Teller Machine (ATM) or at a bank or other financial institution over the counter, up to a certain amount. It will be the credit limit (a given percentage of the amount of money found in the account) when it comes to a credit card. When this cash advances are made, a fee is incurred of between 3-5% of the amount which has been borrowed. If the cash advance is made on a credit card, the interest is always higher than when it is done on other credit card transactions. The interest increases on a daily basis starting from the day the money is borrowed. In other words, cash advances are short-term loans which one can secure against his/her credit card up to a certain amount. This advanced cash can easily be obtained from an ATM or a bank, where a credit card rather than a debit card will be used to get the money. In order to get a cash advance, many companies don’t allow one to get the whole amount of his/her limit. With this, one cannot rely on his credit card to provide him with much money in the event of an emergency. Securing a cash advance is very easy but costly too, because it comes with fees and expenses. These fees, also known as interest rates on cash advances are usually much higher than the regular interest rate on the credit card. Also, what makes it worse is that the interest starts accumulating on the day the advance is taken and there is usually no grace period given for the repayment of the loan. So if one decides to take a cash advance, you need to pay back as soon as possible.

Getting a cash advance loan

Cash advance is an instant cash advance loan given alongside a person’s valuables without having to sell them. An example of an instant cash advance loan institution is “Cash Converters’ they safely keep your valuables in return for cash. When you return within a month and pay back the cash advance loan including the fees, they will return your belongings.

How the cash advance loan Works

To get an instant cash advance loan, you have to bring your valuables into one of the ‘Cash Converters’ stores. They will proceed by discussing your needs with you and test the valuable items brought if necessary, thereafter, they offer a price for the valuables. An agreement will be made and the cash shall be handed over to you while they keep your valuables. If you pay back the loan and the interest rate within one month, they return your valuables. It should be noted that the fees charged will be determined by the amount of money loaned and should comply with the National Credit Act. For the advance cash loan to work well, there has to be a team of professionals ready to serve you.  

Also, cash advance can be gotten online which is through a simple online application procedure. If accepted, you can have cash in a few hours since the information for the approval of the loan is done electronically. To benefit from a cash advance online, you are required to have a bank account, a social security number, and proof of income to complete the application for the cash advance online. Every cash advance has a guarantee of 72 hours so within this period, if one is no longer interested in the cash advance, the principal sum will just be deposited within the 72 hours and no fee will be paid. All cash advances awaiting approval is subject to a standard underwriting criterion. These criteria rates and terms will differ depending on the state of residence of the party undertaking such.

 

Ways in which one can secure cash advance online.

Cash advance, to many people (can also be termed payday advance) is something associated with a credit card or other type of credits. Many credit card companies or banks make it easy for clients to have access to cash advances close at hand by using their credit card at a local ATM. The problem with such a strategy is that the cost of the advance adds up rapidly and one may not even realize what all those costs were. You might likely be held to pay an ATM fee charged by the bank that runs the machine, and also pay a fee to the credit card company for taking the advance, alongside finance charges and interest if you don't pay the money back before your next billing sequence. Some credit card companies charge interest on cash advances that are higher than the interest charged on regular balances, which can lead to increases in the total balance.

If one wants to enjoy the benefits of a cash advance without necessarily going to a store or bank, he/she might want to consider seeking a cash advance loan online. Also, due to the fact that borrowing money is usually linked to very boring long processes, online application turns to be the better option with enjoyable and easy as the whole process takes a few minutes, which are spent in comfort and not standing in queues when you apply in store.

How can one benefit from online company that provides a cash advance?

An online company such as LendUp is able to provide a cash advance. In fact, an online cash advance does not involve actual cash at all.

Concerning online cash advance loan, it refers to a short-term loan that is quickly and easily funded to your bank account after approval. The amount you borrow for a cash advance loan is pretty small, which often means you can pay it back in only one or two payments. These loans are just like payday loans, but cash advance loans do not often entail a single pay back on payday.

In the course of dealing with an online cash advance lender, the entire process is done through the internet. This means that you don't have to go to a physical location or fill in lengthy paper forms. You instead complete an online application form and are informed of your approval status online or through email and receive your funds by means of an electronic transfer to your bank account.

How to apply for a cash advance from LendUp?

LendUp are online cash advance lenders dedicated to helping out customers meet their short-term financial needs. Cash advances from LendUp are achievable by any person with capacity as from 18 years old and above and who meets certain employment or income requirements, and should be able to provide the information required in a five-minute online application process. Precisely, the application should comprise of:

  • The clients phone number
  • A valid email address
  • Current contact information, including an address
  • A current account that allows electronic transfers

LendUp will ask for the client’s employment specifics or the source of any periodic income. Once the application form with LendUp for a short-term loan has been completed, they will deliver an answer instantly to you. LendUp is good because it does not depend on the traditional credit check or credit score to make lending conclusions. The customer will not have to fax any documents or wait for days for a reply. LendUp's short-term loan options generally offer first-time borrowers up to $250. To increase the amount of money one can borrow at any time from LendUp, will depend on how prompt you pay what you borrowed.

Why go in for a Cash Advance

1. Easy to Succeed.

One of the advantages for choosing a cash advance is how easy it is to be suitable for one. Banks usually place a number of severe loaning criteria on debtors, while lenders of cash advancements don’t. There will always be some background checks carried out, but it is mainly to check if you’re capable of repaying the loan.  

2. Instant Cash Advance Loans

Cash advance is almost instant as you can expect your money sent to your account within a short period of time after the application form and process have been examined and approved. This is as opposed to banks where the procedure to get money is so lengthy tiring.

3. It is Convenient

This is because it is easy to get a cash advance online from the comfort of your house and the cash advance loan lender’s websites are open at flexible hours. It is highly accessible as online cash advance can be done through a call, email, or live chat, in order to get the assistance you need to get funds.

4. It is Flexible

With the cash advance loan, one has the possibility of spending the cash as you deem fit without having to be answerable to anyone as compared to other types of loans, which frequently put in place restrictions on how you can use the money. 

5. Equal rights to all types of borrowers.

6. Safety and protection of your personal information.

7. Simple requirements to meet and absence of credit check and faxing.

Though it is easy to take out a cash advance from your credit limit, it should be highly avoided unless in extreme emergency situations because of the following reasons advanced;

What discourages one from going in for a cash advance?

  • Cash advance fees are extremely expensive: Cash advances are charged a fee which is either a minimum flat rate or a percentage of the amount of the cash advance loan. Cash advance fees typically range from 2% to 5% of the cash advance amount, with more credit cards charging a higher fee. For example, the credit card terms may state the cash advance fee is $5 or 5. Under these terms the fee on a $100 cash advance would be 5% of $100 is $20.
  • ATM fees: Apart from the cash advance fees,one will also be charged an ATM fee, between 2-5% or $2 and $5, depending on which bank’s ATM you use. The ATM operator and the credit card issuer may together charge an ATM fee.
  • Interest rate is higher: Cash advances always have a higher rate of interest than the rate for purchases and even balance transfers. Supposing that each of the balance was paid within the same period of time, you would pay more interest on a $500 cash advance than on a $500 plane ticket. Also, the longer it takes you to pay off a cash advance, the more your interest will accumulates.
  • No grace period: Most credit card terms specify that there is no grace period for cash advances. This means that you don't have an opportunity to pay in full and avoid a finance charge. Interest kicks in from the moment you take the advance cash. So it is always advisable to pay as soon as possible and not have to wait until your bill is used to pay the balance.

What happens if payments on cash advances are not completed on time?

The following may result in the event you fail to make your payment on time:   

  • Monetary Implications: If you fail to pay back what was loaned to you within the specified period, you will pay a late fee. 
  • Collection Activity: Any unlawful amount can be collected via a standard collection practice, which includes contacting you by phone, mail, or email. The cash advance agencies may also exercise any of their rights under a cash advance contract with you. If the agencies are not able to collect any unlawful amount one may have them through such actions, they may also sell your debt to a third party debt buyer or engage a collection agency, who may also engage in a collection activity with you.
  • Impact on Your Credit Score: Failure to make timely payment on your cash advance may reduce your notch with agencies such as (Equifax, Experian or TransUnion) and you may be stopped from getting credit or other services from a provider that uses such agencies.
  • Refinancing a Cash Advance: Automatic refinance of cash advances are not always available. But where refinances are obtainable (varies by state), one may refinance his/her cash advance by logging in as a returning client preceding to the due date and applying for a refinance.

 

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