Enjoying Your Retirement

Posted on: 23 March 2017

There may be times in your life when it seems like everything is going wrong, and everything that happens might be affecting your wallet. During these times, you may need some extra cash to use to pay for the unexpected surprises that popped into your life. If you are in this position and are considering taking a cash advance from your credit card, you may want to reconsider and look into a paycheck advance instead. Here are two reasons a paycheck advance might be a better option for you.

Paycheck advances do not affect your credit

A paycheck advance is a short-term loan you can obtain through a payday loan lender. One of the best things about these loans is that they do not affect your credit. The lender will not run a credit report to determine if you qualify, which means anyone can qualify, and the lender will not post the loan on your credit report. This means that taking a paycheck advance through a payday lender will not affect your credit at all.

If you take a credit card cash advance, it will affect your credit, and the first thing it will affect is your debt utilization rate. When you borrow money on a credit card, it raises the balance. This, in turn, raises your debt utilization rate, which will cause your credit score to drop.

A cash advance on your credit card can also affect your credit if you miss a payment. This will show up as a late payment, and it will cause your score to decrease too. This late payment will remain on your credit report for many years.

Credit card cash advances are expensive

The other thing to consider is the costs of a credit card cash advance. Typically, a credit card company will charge a percentage of the money you borrow from the card, or they will charge a certain fee. In addition to this, you will pay interest on the money, and the interest rate for cash advances is generally much higher than the regular interest rate on the card. It's also important to know that the interest will begin accumulating as soon as you borrow the money. In other words, there is no grace period with cash advances on credit cards.

There are also fees and interest on payday advances, but they may be less than the fees and interest you will pay in all on your credit card cash advance. One reason for this is that a payday cash advance is generally due much faster than the balance is due on a credit card cash advance.

If life is throwing you curveballs and is causing you to need some cash fast, you may want to consider taking a paycheck advance to help cover the extra expenses you currently have. For more information, talk to a professional like Payday Express.