Cash Advance Facts That You Must Know!

A cash advance is a short-term loan offered by a bank or an NBFs lender. The cash advance loan also refers to the service provided through credit card where the issuing authority allows the cardholders to withdraw a certain cash amount as per your approved eligibility. Cash advances generally come with steep interest rates and fees, but yes, they are attractive among borrowers as you get the fast approval and availability of the cash quickly. Cash advance or instant loans are very convenient to manage any emergency.

Advantages of Cash Advance Loans

We all need some additional cash to cover an unexpected expense or a shortfall toward the month's end. Cash Advance Loans are the quickest way to get money to cover those surprise expenses.

But having said this, Cash Advances come with some cons or negatives too:

ü  Processing Fee - In cash advance loans, the processing fee is either flat or fixed amount or a certain percentage, i.e. 1% to 5 % of the loan amount. Lenders pick the higher one.

ü  Higher Interest Rate - Cash Advances come with the highest rate of interest ranging from 22% to 30% as compared to any other loan.

ü  Immediate Interest Accrues - The interest rate in case of cash advances is charged aggressively for example, in credit card, you'll be charged from the day you take the amount, but in case of cash advance loans, you have to pay the interest amount for the whole period even if you pay back the loan amount.

This way Cash Advances are very aggressive and expensive, which also includes certain taxes, this makes hard for the people to pay back who take Cash advance loans.

How Cash Advances Can Harm Your Credit Score?

Taking cash advance loan will not impact the same, but it will start hurting when you begin utilizing the money. In any case, taking a cash advance can place you in a difficult situation that would bring down your Credit Score rating.

The cash advance loan is added to your balance parity, which changes the pattern of your credit use. Credit Utilization is a score that takes a gander at the amount of your all credit which you're utilizing. Ideally, it is recommended to keep this number under 30%. Interest also starts accruing from cash advance, which makes it further difficult for the person to clear all debts. And if you miss any of the loan repayments, this will more worsen the situation for you.

How Cash Advance Loan Is Different From Payday Loan?

If we talk about the form their basic structure and practicality, both are more or less similar. In both cases, the borrower gets the loan amount immediately and for a shorter period with hefty processing fees and higher interest rates.

The main difference in Payday Loans as compared to Cash advance is that they are, decided based on your pay cheque rather your credit history. The payment of Payday loan is done immediately on the very next day of your salary credit through post dated cheque which you give to your lender at the time of loan approval and disbursal.

No matter which loan you take, but if manage it smartly and responsibly, it will help you to manage any financial stress is an easier way.

Instant Loans in India: Some Signs that You Are Steering Towards Massive Debt

A big shout out to all those people who keep worrying about the monthly dues! We feel you! Fear of increasing debts- it is a very common feeling almost each one goes through. What is troublesome is that many times it could actually be true! The ease with which we get Personal Loan these days may make you overburdened with the monthly dues.

But, how do you then know that you could be in a trouble due to your Online Instant Loan? Well, we have listed down a few pointers for you that will help you decide whether or not you are in deep waters!

You have missed some EMIs

In case you notice that your outstanding dues are more than the payments you make, be cautious: DEBT TRAP is nearby! Therefore, it is better if you take control of the situation each month, calculate your expenses, cut down on extra spending and manage to carefully make the EMI payments so that it doesn’t go on accruing for you.

Your fixed expenditures seem too much

This could be really serious, guys! If you find yourself tightly squeezed and not having enough liquidity to feed your fixed expenses like house rent, food and electricity, school or college fees, you are in debt.

You don’t know what you are paying

Just ignoring the mails and the reminders won’t help you actually get rid of the debts! You must avoid overlooking the EMIs and other reminders for your debts. This will help you plan your month in advance.

Borrowings from close circle

Again, this may seem as an interest-free option to you, but No! When you have to borrow from your friends or relatives, it only implies that you are in too much debt. In such cases, you tend to borrow more and then the cycle continues. Instead, you can look for low-interest personal loans.

If you fit into any of the above categories, then kindly buckle up your shoe! The road could be really tough ahead! Or, you can simply check out the YeLo app for easy ways to get online instant loans to ease the crunches for you.