You’ve probably heard the term “cash advance” before, but have you ever wondered what it is and if you are eligible to get one? Most people who search the Internet or phone book for a cash advance are usually struggling with a difficult cash flow problem brought on by circumstances they often couldn’t control or plan for, such as sudden car trouble or home repairs that just can’t wait. Sometimes people fall behind on bills because of a job transition or a miscalculation within their budget. There are various reasons people seek a cash advance, and numerous websites and storefronts purporting to provide the best cash advances on the market. Before you apply for a cash advance, it is a good idea to have a thorough understanding of what is involved in taking out this type of loan.
What Is a Bad Credit Loan and How Does It Work?
A cash advance works similarly to any other loan you might take out: It has income requirements, must be repaid within an agreed-upon time, and will negatively impact your credit if you default on your loan payments. Unlike other loans, however, a cash advance does not require that you possess any particular credit score, and so can be very appealing to those with bad credit or no credit. Also, the terms are modified to fit your borrowing needs. For example, some loans trap you into an extended repayment over a long period of time, whereas a cash advance repayment will usually be due on your next payday.
Cash advance lenders review your income, employment status and all other relevant information and then make a determination of how much you are eligible to borrow. Borrowing minimums and maximums can vary from state to state based on current laws, so you will want to familiarize yourself with your particular state’s requirements. In most cases, a cash advance can range from $100 to $999. If you apply for a cash advance, your loan will be directly deposited into your bank account. Online lenders are able to provide you with cash in one business day. They also can provide you with the repayment option of a direct debit from your bank account on a selected due date, automatically withdrawing your payment and taking the hassle out of remembering to repay your loan.
Like most loans, a cash advance will include a fee. As mentioned before, state laws vary and can often affect the amount your lender can charge you for your cash advance.
How Can I Apply for a Bad Credit Loan?
If you’re considering applying for a cash advance but have some lingering concerns about using this method to get the cash you need, then consider for a moment the alternative. Going to a bank for a loan will require you to go through a lengthy application process. Banks will often refuse to lend to those who have poor credit. A bank loan will also require a higher minimum, with most banks setting the loan minimum at $1,500, effectively locking you into a larger loan than you may actually need. Furthermore, in addition to potentially coming with the embarrassment of getting turned down for a loan because of your credit, a credit inquiry for a loan extension can actually harm your credit. Most people lose several points on their credit score for every credit check that is run, so it may not be worth further damaging your credit if you already have a low score.
Once you’ve decided you would like to pursue a cash advance, you will want to gather all the relevant information needed to fill out an application with your lender. Before you apply make sure you meet the following eligibility requirements:
- Have a bank account in your name.
- Have a valid e-mail address and phone number.
- Be a U.S. citizen or permanent resident.
- Have steady monthly income.
- Be at least 18 years or older.
How Much Can I Borrow and What Can I Use the Money For?
A cash advance is a loan that is based on your income. It is an advance on your paycheck that tends to reflect an amount that your lender feels you can safely repay based on an average paycheck. Amounts can vary from $100 to $999 but check with your state laws for specific borrowing limits. You can use the money for any pressing needs, such as these:
- Car repairs
- Home repairs
- Unpaid bills
- Medical treatment
If you’re in need of cash fast and don’t have the best credit, a cash advance can be the perfect solution for getting you back on track. It only takes a few minutes to apply and you can get cash in one business day.