When you are strapped for cash and need some extra dollars to tide you over until the next payday, cash advance loans are a great option. As well as being able to make purchases with your credit card, many also allow you to withdraw money. This is known as a cash advance.
It involves taking the cash from your credit account, at an ATM, or directly transferring it into your bank account with online banking. Cash advance loans can also come in the form of short-term loans. Here we take a look at how these cash advance loans work and whether they are the right option for you.
What Are Cash Advance Loans?
The general idea behind cash advance loans is gaining access to money quickly, in order to tide you over in the short term. These types of loans can come in a variety of different forms:
Short-term loans: some lenders will let you borrow up to $500,000 dollars in an instant cash loan.
Credit card loans: many credit cards will allow you to withdraw money as a cash advance to spend as you please. This is usually a much smaller amount than what you can take out with other types of cash advance loans. However, it does have the bonus of coming with a lower interest rate and lower transaction fees.
Payday loan: this is a small loan of around up to $2,000 that is then paid back with 16 weeks to a year.
The one thing all these types of loans have in common is that they come with high fees and charges. As the borrower, you end up paying for the convenience of having access to the money you need, when you need it. In many situations, it is well worth it, as long as you are sure you are able to pay it back in the correct timeframe.
Alternatives To Cash Advance Loans
If you are looking for an alternative to cash advance loans there are a couple of options you can entertain:
- Family or friends: if it is only a small amount of cash you need to tide you over, then consider asking family or friends. This will save you the fees and interest involved.
- Speak to creditors: if you are trying to pay off a bill and don’t have the funds available, then it may help to discuss your problem with your creditor. They may be able to stretch the terms of your agreement. This means you can wait until the money comes in before paying it off, saving you the hassle of a cash advance loan.
- Take out a personal loan: personal loans generally come with better terms than the cash advance. The downside is, you don’t receive the money nearly as quickly as a cash advance loan.
If you do find yourself in a position of needing a cash advance loan, then it is worth doing your research to work out exactly what you need.
Getting A Cash Advance
There are many different reasons you might be in need of a cash advance loan. Some of these are:
- Christmas spend: we all know the end of the year can be expensive. A cash advance can be just what you need to pay off everyone’s gifts in advance to prepare for the silly season.
- Moving house: there are many costs that come with moving and they can dig into your budget and beyond. A cash advance can see you through this period.
- Hospital bills: if you fall ill, you may find yourself with unexpected hospital bills. A cash advance can help you out in the short term.
There are many benefits that come with taking out cash advance loans, as long as you have factored in the costs that come with them.
The fees and charges that come with taking out a cash advance loan will vary between lenders, but there is a rough idea of what to expect.
- A one-off establishment fee of 20% of the amount loaned.
- A monthly maintenance fee of 4% of the amount loaned.
On top of this, there are more fees that can be charged if you don’t make the repayments or end up defaulting on your loan. It is a good idea to make sure you have the means to pay off the loan before going ahead.
Finding The Right Loan
If you are in need of cash fast, then speak to the experts at the Australian Lending Centre. We can find the right loan for your needs and help to get you back on track financially. Our short-term cash advance loans can allow you to borrow up to $500,000 depending on your circumstances, providing you with access to the cash you need. Simply pick up the phone and call today.