If you are short on money, then one of your options is to get a cash advance, However, you might not be too familiar with cash advances and might not be ready to commit to such a loan. To help you get a better idea of what a cash advance is and when you should get one, here is an introduction to the subject:
What is a cash advance loan exactly?
A cash advance loan is basically a loan that you take out before your payday and pay back on your next payday. They are meant to be taken out when you only have a few days left until your payday and often have interest rates that are much higher than other types of loans. This is partially to balance out the ease at which one can acquire cash advance loans, since they often have very lax requirements. Some cash advances are available even if you have terrible credit score rating. You might have also heard of these loans referred to as "payday loans" or "payday advances."
When should you get a cash advance loan?
Because these loans have relatively high interest rates, you don't want to use them any more than necessary. If you need to pay some medical bills or buy food, then a cash advance loan is a valid option. However, if you want to buy a new TV because there is a sale that ends soon, then you are much better off saving your money and holding off. In many cases, such sales will happen again in the future and the amount that you will pay as interest on the loan might even outweigh the discount on the TV, especially if you fail to pay back the loan on the due date.
What happens if you don't pay back a cash advance loan on time?
When you get a cash advance loan, you will often write a check to the lender, to be cashed in on the date of your next payday. This is to ensure that you don't forget about your loan. However, there are situations where the lender might go to cash your check and find out that you don't have enough money to cover it. In these cases, your repayment date will usually be extended to your next payday. Unfortunately, it will also result in significantly more interest, which can quickly become a very serious problem if you don't deal with it diligently. If you think that you will be unable to make your payment, talk to the lender before just letting the check bounce. You can often renegotiate for a lower interest rate than the penalty of missing your payment completely. Read more about cash advances online.
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