Cash Advance Credit Card
Information about a Cash Advance Credit Card
Access to needed funds is essential for many households. An unexpected bill or financial emergency can wreak havoc on a tight budget. One simple solution is to use a credit card cash advance to fill the financial gap. This is a relatively easy process, regardless of the type of credit card you have. Most companies will explain how to get a credit card cash advance in the credit card agreement.
Generally, a cash advance on credit card is available through your local bank or any ATM machine that accepts the type of card you have. By using the personal identification pin (PIN) number you received when the credit card was issued, you can withdraw the amount you need instantly.
You withdraw the money from the credit card balance the same way you withdraw money from a checking or savings account. The difference is the interest and/or fees charged to the credit card. The amount of interest and/or fees usually depends on how much you withdraw. The amount of cash you withdraw is posted to your credit card.
Another way to receive a credit card cash advance is with a check that your credit card issues. Typically, these are checks that you receive when the account is opened to use as a personal check. These checks can be used to pay a bill or purchase goods. Additionally, you can write the check for cash and deposit the money into your bank account.
Cash Advance Credit Card Deals
It is possible to receive credit card deals for a cash advance through the mail. Especially during these tough economic times, most people are leery about accumulating too much debt. Existing credit cards you have might offer a cash advance deal to encourage usage of the card. Maintaining a high balance is costly; however, taking advantage of a good deal could save you money long-term.
Most credit cards cash advance deals come with a zero percent interest rate. This is an incentive to use the card for cash. Without this type of deal, you might receive a higher interest rate on the cash advance. Some rates are as high as 23 percent for cash advance credit cards.
Use a Cash Advance from Credit Card Wisely
The ability to get a cash advance from your credit card is good when you have a cash shortage. However, using a cash advance card wisely can reduce your overall costs long-term. It is important to read the fine print and fully understand the different interest rates and how they are applied to your credit card. These five tips will help ensure the cash does not cost more than it is worth.
- Try to save cash advances for emergencies. It might be tempting to get a cash advance from credit card to purchase a new pair of shoes. However, unexpected medical expenses or a new refrigerator is more important.
- Find out your cash advance limit. Most credit cards have a limit on the amount of cash advance you can receive. In some cases, it is less than your credit limit. You might incur overage charges and a higher interest rate if you exceed the limit.
- Only withdraw what you need. Withdrawing more than you need could make it harder to repay.
- Use a zero balance card to get a cash advance. Payments on cards with multiple types of balances such as a balance transfer, purchases and a cash advance go towards the one with a lower interest rate. This causes the higher interest rate balance to accrue, making the advance more expensive.
- Do not use the credit card for purchases before repaying the cash advance. Again, payments will go towards items with a lower rate first.