Terms and Conditions
What is a cash advance?
A cash advance is kind of like an instant cash loan using your credit card. You find yourself in a situation in which you need some quick cash, say, to buy a used car. You don’t have enough in your bank account, so you use your credit card and take a cash advance. You must be aware that credit card companies charge interest from the date of the advance until it is completely paid back in full, and may also charge a high transaction fee based on the amount of the advance. It is different from a cash back credit card.
Also, remember that when you send in a payment to the credit card company, it will usually be used first pay off any new purchases you have made and not your cash advance balance. In almost all cases, payments are automatically credited to the lower
APR balances (usually purchases or balance transfers) first. If you want the payment to go towards paying off a cash advance, rather than toward purchases or balance transfers, you will need to find out from the company how (or if) you can do that. Be sure to read the Terms and Conditions for your particular credit card – payment policies like this one are stated there. Since the APR for a cash advance is almost always higher than the APR for purchases or balance transfers, borrowing cash using your credit card and paying it off over time can be very expensive!
See also:
What is a cash advance fee?
What is a cash back credit card?
What fees do credit cards have?
Last update: 2006-09-25 19:06
Author: BKO
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