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Sure, getting a cash advance can be as easy as going to the corner store. In fact, there may be a short-term lender at the corner of your block, called a payday loan lender, but you should avoid this like an expired carton of milk.
You need to know what you’re getting into, what your options are, and how cash advance offerings differ depending on who you work with. Making a bad cash advance decision could cost you significantly in money and poor credit. We’re going to show you the best way to get a cash advance when time is of the essence.
What Online Cash Advances Are
A cash advance is another name for a short-term loan, a specific amount of money you can borrow from an institution like a bank or alternative lender. These loans are designed to help you in times of emergency with fast cash when you need it. Unfortunately, getting a fast cash advance from a bank can be difficult, especially if you have low credit. But even if your credit is good, banks do so many checks and assessments, and it can take days before the funds get released.
Thankfully, trusted alternative lenders are starting to emerge that can deliver fast cash without the wait, thanks to advancements in banking and internet technology. Many of these lenders also offer cash advance apps that require an online account to help you get your funds even faster.
Getting A Payday Advance
Cash advances and payday loans are sometimes synonymous terms, but a payday loan is just one type of cash advance. The problem with a payday loan is, you only get little more than a few weeks to pay it back before punitive cash advance interest rates kick in; sinking you deeper in debt. How cash advances work really just depends on the type of cash advance product you get.
Payday loans are meant to get you to the next paycheque. Then, you are expected to pay it back, or it could be taken directly from your paycheque. Many payday loan lenders will bank on the fact you most likely can’t pay it back in such a tight timeframe. This is why the interest rates are so high, and the business is often considered “predatory.” In fact, most provinces have enacted legislation to regulate payday lenders while protecting borrowers from unfair business practices.
On the other hand, a short-term personal installment loan from a reputable lender (like Spring Financial) is a cash advance with a set repayment plan and no hidden costs. The repayment time frame is usually shorter than other installment loans but longer than a payday loan, giving you plenty of time (if you need it) to pay it back. The right lender will also offer an open-ended agreement so you can pay the loan back early and avoid monthly interest charges.
Avoid the sky-high cost and hidden service fees (including late fees and NSF fees) that are so common with payday lenders! Apply online for your short-term personal installment loan today!
Credit Card Cash Advances
Another form of a cash advance you can use to access funds is to take out a withdrawal on your credit card. This is easy to do, as long as your credit card offers this service (most do), and of course, you have the required credit limit availability on your credit card balance to make the withdrawal.
How credit a credit card cash advance works is simple. All you do is go to an ATM and use your credit card like a bank account to withdraw the cash. If you aren’t sure if you have this availability and what your limit is, you can check your credit card agreement, usually in the fine print.
That said, if you do have the ability and the limit of your card, there’s no approval process since you were already approved for the credit card. Essentially, this type of cash advance can be a guaranteed approval loan or instant approval loan since you have instant access to the funds. There are no other instant loans since they all require an approval process.
Now, here’s the bad news: taking out a cash advance on a credit card is way more expensive than making a regular purchase since there are additional fees. Credit card companies charge a much higher interest rate on cash advances and sometimes even extra fees.
Plus, you don’t even get a grace period. Most issuers charge elevated interest as soon as you withdraw the money rather than giving a 30-day grace period to pay it back. Also, there is usually a charge for the service – either a percentage of your cash advance or a flat fee, which many consider to be hidden fees. These fees will just keep racking up if they aren’t paid by your statement due date.
Online Cash Advances
Whether you choose a payday loan or a personal installment loan, cash advances can usually be obtained in short order because the lender understands you need funds quickly. You can apply for a cash advance online with online lenders, and the approval process is much quicker than that of most other loan products.
Once you get approved with these online services, the cash advance will be deposited directly into your bank account. That said, not all payday loans are done online. Some lenders have physical locations and will put the funds in a lump sum on a debit card or prepaid cards for use so you don’t have to supply your financial information.
Applicants looking for a cash advance don’t require a good credit rating to be successful. This type of loan can be helpful to deal with financial emergencies and money management between paycheques or to cover unforeseen expenses, like a vehicle repair or a ballooning wedding budget. Plus, you have much more time to pay back a cash advance loan, with more favourable interest rates, compared to a payday loan.
Due to the fact that cash advances from personal loans can be deposited directly into your bank account, you may be able to get the funds you need faster. You no longer need to wait a few weeks for a bank to come through. You can get the funds right when you need them. Many different lenders offer online cash advances, including Spring Financial.
Types of Cash Advances and How They Work
In Canada, there are credit card cash advances, instalment loans and payday loans. While we have already gone over a few of these, let's break them down and take a look at how they work.
| Type of Cash Advance | Average Interest Rates | Criteria To Qualify | Documents Required | Repayment Date |
| Payday Loans | 300% - 400% | -government issued ID -be the age of majority of your province-have a steady source of income | -proof of income -2 pieces of valid government ID | Your next payday or pay cycle |
| Credit Cards | 17.99% to 29.99% | -Government-issued ID -completed application -credit check | -valid government-issued ID -proof of income -SIN number | As soon as possible |
| Unsecured Loans | 9.99% to 60% | -steady income -valid government-issued ID -be the age of majority in your province -debt to income ratio below 50% -credit check | -2 pieces of valid government ID -proof of address such as utility bills -proof of income -SIN number -financial institutions information on PAD form | Only a small amount for each of your loan payments based on the loan amount that’s specified in your loan agreement. Usually 6 months to 60 months. |
| Secured Loans | 5% to 35% | -steady income -valid government-issued ID -be the age of majority in your province -debt to income ratio below 50% -credit check -require collateral | -2 pieces of valid government ID -proof of address such as utility bills -proof of income -SIN number -the value of the collateral -financial institutions information on PAD form | Only a small amount for each of your loan payments is based on the loan amount specified in your loan agreement. Usually 6 months to 60 months. |
How Cash Advances Affect Your Credit Score
How a cash advance affects your credit score is based on what type of cash advance that you get. Payday loan companies often check your credit for approval but don’t report any of your payments to the credit bureaus. This means that paying off a payday cash advance doesn’t improve your credit score, but missing payments and having the debt go to collections will hurt your credit.
For an instalment loan cash advance, the lender will require a hard credit check in order to determine approval whether it’s your first loan or not. This will show the lender your full credit file and credit history. Most online lenders will also report your payments to the credit bureaus. Making your on-time payments can then improve your credit score and show a positive payment history for future credit checks.
Things to Look for in a Good Online Cash Advance Service
If you’re looking to borrow money with a short-term cash advance, you should do some research and find the best provider with a proven track record. Here’s a list of what you should look for:
- Online reviews: Scan reviews of financial lenders to gauge other borrowers’ experiences. Take note of the customer service ratings and record of responsiveness. Seek out which lender actually cares about their clients versus those just looking to make money off your debt.
- Approval speed: Anyone who needs a cash advance is going to be concerned about speed of delivery. Find a lender with the ability to deliver the funds quickly after approval, and straight into your bank account. Optimally, the whole process should take hours, not days.
- Interest rates: Avoid payday loans because you will pay sky-high interest rates versus a personal installment loan from the right lender. Get a competitive rate, not one that will punish you for needing money quickly.
- Repayment schedule: Give yourself some breathing room to pay back a short-term cash advance loan. You’re likely going to need more than a couple of weeks to pay this back. Find a schedule that will set you up for success.
- Option for early repayment: A short-term cash advance loan can be paid off in full at any time and hence save you on monthly interest payments.
- Credit background: Find a lender who will work with applicants of all credit backgrounds. Even if your credit rating isn’t positive, you can still be successful at obtaining a cash advance.
Online Cash Advances With Spring
Spring Financial checks all the boxes listed above with a customer-first approach that emphasizes finding the right financial solution for your needs.
Spring works with all credit situations and, unlike payday loans, gives applicants the time necessary to repay the cash advance, or you can pay it back as soon as you like. Our online application process is very convenient; it takes just three minutes to apply!
If you’re in need of a short-term cash advance loan to get through an unexpected expense, sudden loss of income or any other situation, consider Spring to help you reduce that financial stress. Loans with cash advance limits of up to $35,000 can be approved and transferred to your bank account within 24 hours.
Apply today! It only takes 3 minutes! To get started, all you have to do is select how much you want and let us take care of the rest.
