A cash in advance loan is a popular form of loan in California, even though it carries a higher than average interest rate. Cash advance loans are typically used for immediate expenses and financial emergencies, rather than long-term financing needs.
Cash advances are also typically made without requiring a credit check, making them one of the most popular forms of equity loans for people with bad credit.
There are two types of loans that can be considered cash advances:
Credit Card Cash Advances
A credit card cash advance is made when a credit card holder uses their credit card to take out cash instead of purchase something. Credit card cash advances are usually received by using your credit card in an ATM, or by visiting a bank branch and requesting a credit card cash advance from the teller. Credit card cash advances should not be used unless you can’t use your credit card in the normal manner to buy something, as the interest rate is significantly higher when you use the card to withdraw cash, rather than in the conventional manner.
Unless you have an absolute emergency need for cash, it’s almost always better to get your funds some other way than using other loans. Don’t rely on these types of loans unless they’re being used as your last resort.
Advantages & Drawbacks
Cash advance loans can be a great solution for coming up with fast cash, but they come with some extreme disadvantages compared to other types of financial assistance. Make sure to consider the following pros and cons before taking out a cash advance of your own:
Cash advances don’t require as much paperwork, or as long a process as other forms of immediate financial assistance. They also:
- Can usually be done very quickly, making them a convenient solution for people that need instant cash.
- Can be received without having to provide anything of value as collateral, making them somewhat easier to obtain than collateral loans and secured personal loans.
Although cash advance companies seem to offer a simple product (fast access to money), whether you get the loan through a credit card or a loan center, these loans always come with some significant disadvantages, especially in terms of price:
- You will have to pay back your loan in full by the time of your next paycheck, or sometimes by the end of the month; otherwise you face significant interest hikes along with other financial penalties. It can thus be extremely expensive to get even a small amount of money, and some people are almost never able to get out of the cycle of missing their payments, adding more debt, and then doing it again.
- They may seem like a quick fix for a short-term cash shortage problem, but if you don’t make the correct repayments on time, you may end up paying much more back than what you initially borrowed, and significantly more than you could have paid back by getting an alternative loan (like a car title loan or some other form of collateral loan).
- Cash advances have some of the highest interest rates of any form of loan, along with potential hidden costs, fees, and penalties (some advance loan centers even charge customers for paying off their loans early). They are often significantly more expensive than any other type of available loan, and should only be considered after other options have already been exhausted.
How to Get a Cash Advance
You can get a cash advance by using your credit card at an ATM machine, by visiting a local bank branch and requesting one from the teller, or by going to a loan center. Most people use loan centers to get cash advances, even though they’re probably the most expensive option, with the worst contracts and highest interest rates.
There are also some websites which offer online cash loans, but their terms and conditions may differ slightly from regular in-person loan offices and some of them are certainly scams. Be cautious about contracting with an online vendor who supplies loan services, as it’s very difficult to verify if they are a legitimate business or not.
Why Car Title Loans are a Better Option than Cash Advances
Instead of getting a cash advance, you should seriously consider taking out a car title loan, for a variety of reasons. You’ll be able to raise hundreds to thousands of dollars (just as much as a cash advance), likely pay a lower interest rate, and be able to repay your loan early without having to face additional fees. You’re also likely to have better repayment terms, more time to pay back the entirety of your loan, and the ability to pay it back in small increments, rather than in one lump sum.
Remember that interest rates charged for a car title loan are almost always significantly lower than what a borrower would receive at a loan center or via a credit card cash advance, simply because there is collateral involved in the loan, meaning that the lender faces less risk in the transaction. Before you get a cash advance, make sure to at least look into car title loans, or you could end up wasting hundreds or even thousands of dollars on an overly expensive loan.
Car Capital Financial
Car Capital Financial understands that there are some situations when a quick loan is absolutely necessary, and we are here to help through difficult financial times. We offer car title loans that can be awarded in as little as thirty minutes, anywhere in Southern California. Title loans are issued based on your ability to repay the loan.
If you are looking for a quick and easy way to borrow money, please call us now at (888) 500-9887.