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What Are Cash Advances? Should You Get One?

What Are Cash Advances? Should You Get One?

The most attractive side of cash advances is that you can get them more quickly and easily as compared to other funding solutions. This article will help you decide whether you should apply for a cash advance or not when in need of extra working capital. 

Cash Advances: What Are They?

A cash advance is a short-term funding solution offered by your credit card issuer. You can receive it even if your credit isn’t excellent. The provider will charge you a cash advance fee that’s either a minimum flat rate or a percentage of the amount you’ll receive. 

The most important factor that can hold you back from applying for a cash advance is its higher interest rate. The good news is that you can apply to a provider like that’s dedicated to offering the cheapest possible rates of cash advances in the space. FAM is an award-winning high-risk lender in the U.S. that’s rated A+ by the BBB.

Types of a Cash Advance 

When taking out a cash advance, you’re receiving money against your card’s line of credit. There is more than one way you can use to get a cash advance:

  • Credit card cash advances: This is the most widely used way to receive a cash advance and means borrowing against a cash advance limit on your account.
  • Payday loans: These provide small cash advances to borrowers that need to be paid back on the next payday.
  • Merchant cash advances (MCAs): You can borrow money based on your future sales projections.

How You Can Take Out a Cash Advance

Here’s how you can take out your cash advance:

  • Online: You can take out your cash advance through your card issuer’s website or mobile app. This will save you the hassle of visiting the issuer to request an advance.
  • In-person: If have a card from your bank, you can use your card to request a cash advance from the bank. 
  • ATM: You can get your cash advance through your bank’s ATM. 
  • Convenience check: You can use the convenience checks offered by your bank to take out the amount you need as an advance.

Should You Apply for a Cash Advance?

A cash advance offers an easy way to get cash fast. However, expect to be charged higher interest and fees as compared to other forms of financing. Make sure to turn to a reliable provider that offers the lowest possible rates.