Cash Advance: When a Little Extra Helps


Uh-oh! The furnace just went out in the dead of winter, and your son broke his arm. You just paid all your bills, and there?s nothing left to meet these emergencies. If they could just hold off until payday, you?d be fine. But emergencies have a way of happening at the worst possible times. A cash advance may be just what you need to get you through to payday.

A cash advance, or payday loan, is a small, unsecured loan against your next paycheck. Typically, interest rates and fees run from ten to twenty-five percent of the loan, and the length of the loan is generally two weeks. You can apply online, there is little hassle, and you usually have the money within 24 hours or less, automatically deposited into your checking account.

Some lenders offer the first cash advance at no interest. This first advance will be small, possibly only $100 or $200 dollars, but as you pay your loans off, the lender will start to increase the amount you are allowed to borrow. Most cash advances top out at a maximum of $1000 to $1500.

Even with poor or no credit, you are still eligible for a cash advance if you make at least $1000 a month, have a checking account, are 18 years old or older, and are an American citizen. If you don?t have a job, but receive Social Security, disability payments, or alimony, you may still apply for a cash advance. You may be required to fax a statement of benefits letter or other proof of income to the lender. Active duty military have options from the US government and are not eligible for payday loans or cash advances.

To apply, fill out an online application. You will be contacted by phone or email by a representative who will verify information and explain your repayment options. You will also find out if you qualify. Each state has its own rules governing cash advances so ask your lender to explain these to you.

You may not qualify for a cash advance if you have recently filed bankruptcy, have unpaid cash advances or payday loans, or have a verifiable income of less than $1000 per month. Other disqualifiers may include unemployment, newly opened checking accounts, or less than six months at your current job. In some cases you will not qualify if you are paid only once a month. Your lender can tell you what the rules are in your state.

Lenders often have cut-off times for the next day?s deposits. Make sure you find out what these are. If you apply on a Friday or Saturday, you will most likely not receive funding until Monday. Be sure to have your bank routing number and account number handy when you apply as you will be asked for this information. In some cases, the lender will verify with your bank that you have been making regular deposits from your employer for several months.

There are several repayment options, and your lender will explain these to you. The most common is to set up automatic repayment through your checking account. When you get paid, the cash advance is automatically deducted and paid back. If you can?t repay the advance, you may be granted an extension. There are two types of extensions.

The first is to pay the interest and fees incurred to date, and roll the balance of the loan over into a new loan due two weeks later. This is the most expensive option and will cost you the most in interest and fees. It is also not legal in some states so be sure to check with your lender. Another option is to pay as much as you can of the balance, plus interest and fees, and then extend the loan again. If you still can?t pay the entire balance, you may be eligible for another extension.

If you need an extension, be sure to contact the lender several days in advance. Most require at least 48 hours to process the extension and some require more. There is also a limit on the number of extensions you can have before the balance of the cash advance is due in full. Be sure to check with your lender about this.

A cash advance is a good way to get the extra cash you might need in an emergency. They are not intended to be used as a steady source of income, and most states have laws to prevent this. The lenders support this and will require a waiting period between loans. Generally, once you have paid off your last loan you must wait about a week before applying again. In addition, you are not eligible to apply until all previous cash advances have been repaid.