Cash Advances vs. Check Cashing Stores: Which is Worse?
These days, most transactions happen electronically. People can send money to one another quite easily through their bank accounts, with apps on their phone, or even over social media!
But sometimes, electronic funds just aren’t going to do it. You need cash. Maybe you’re stranded at a rural gas station; maybe you’re buying shawarma at that old-school hole in the wall that won’t take cards; maybe you need $100 in ones so that you can roll around in them on your bed like a fancy boy.
Whatever the reason, a need for cash when you don’t have installment loans Delaware any on hand can leave you real hard-up. If your bank has an ATM nearby, that’s your best option, but your other choices aren’t so good. You might end up getting stuck with either a credit card cash advance or going to a check cashing store.
What is a cash advance?
When you use your credit card to buy something, no physical money changes hands, right? The amount that you paid is simply added to your card balance. You’re essentially borrowing money from your credit card company in order to make a purchase
Well, with a cash advance, you’re also borrowing money from your credit card company. The only difference is that the money you’re borrowing gets handed over to you as some of that sweet, sweet paper.
However, taking out a cash advance on your card differs from making a normal credit card charge in two crucial ways.
First, most credit cards carry a separate Annual Percentage Rate (APR) for cash advances. And the APR for cash advances is almost always higher. You could have a 15% APR on your normal credit card transactions, but a 25% APR for cash advances!
Secondly, regular transactions on a credit card come with a 30-day grace period before interest starts accruing. So if you pay off the card during that period, you won’t get charged any interest at all! Cash advances, on the other hand, have no such grace period. Read more
