Cash advances and cash loans are the two most popular lending options that is available to any individual. These quick loans are used by individuals who need cash in a jiffy. In fact all those people who do not have a very good credit card score also generally opt for these loans. However, there is a catch here. Although one can get this loan without much difficulty, but the interest rates charged on these loans are quite high. Hence, the amount that you end up paying is quite high compared to the original amount borrowed. It is advisable that one should consider opting for these loans only when other modes of borrowing money have been exhausted. If you are planning to opt for any of these two, it is vital that you have a clear understanding of the differences between the two and the risks involved.
Cash Loans are so named because one can borrow the cash by issuing a post dated check on the borrower’s upcoming payday. These loans are quick easy and hassle free as the documents required be submitting are quite few and limiting. This loan is generally opted for if the individual does not have a credit card or the amount required is much higher than the amount offered by the credit card.
In a general scenario, the cash issued is between $100 – $1,000 although at times the State can limit the amount to be borrowed. The lender normally asks for your ID proof, your proof of income in addition to a post dated check on the amount borrowed. The borrower also has to bear the lender fees. In most cases, it hardly takes 15 to 30 minutes for the loans to be issued. One can opt for the online loans facility as well.
Note: Keep in mind that the amount that you eventually pay may be quite high depending on the interest rates charged. In some case the interest rates are quite as high as several 100% in annual percentage rate of interest charged, even though you have borrowed the amount for few weeks only.
Credit card issuers have the authority to issue cash advances are offered through. If you do not have a credit card, you will not be able to opt for this. You need to have a credit card in order to apply for this loan. Applying for cash advance is like purchasing any product using your credit card. However instead of buying a product, you are getting cash that you need to return in addition to the interest rates charged. The terms of repayment are more or less similar to that which is applicable in case of your credit card.
Keep in mind that the cash advance repayment is a separate amount compared to the credit balance available. Sometimes, the rules may be such that you need to clear off all your credit card dues before the rules of the loan applied for will get implemented. Hence, if you do not plan wisely, the high interest cash advance loan can be a part of your due clearing statement for a long period of time.
The Bottom Line:
Both these Cash advances and cash loans are quick loans. But the interest rate charged is quite high. Hence you need to be sure whether you can afford it in the long run before you go ahead and apply for any one of them.