4 Reasons to Avoid Cash Advances


Cash advance. The name sure makes it sound like a good thing. Who doesn’t like cash? And “advance” means that cash is on the way right now! Sure sounds like they’re a great deal, right? Well actually, not so much…

In fact, a cash advance is just a short-term loan that comes with some unexpected—and pricey—strings attached. So when is a cash advance a good idea? Well, for most borrowers, the answer is almost never.

What is a Cash Advance?

The term “cash advance” is sometimes used to refer to payday loans. If you see a “cash advance” advertised at a storefront lender, watch out! A real cash advance is a service offered through your credit card company. Anything else that’s called a “cash advance” is probably a payday loan in disguise.

With a real cash advance, you use your credit card to take out a cash loan. This can be done at an ATM or a bank, and the money is charged to the credit card balance rather than taken out of your bank account. So if you borrow $100, your credit card will show a $100 charge—plus a fee for the withdrawal.

Most credit card companies don’t allow cash advances for the entirety of a borrower’s line of credit. For most people, cash advances are capped at a few hundred dollars.[1]

Why should I avoid a Cash Advance?

  1. Charging a purchase is better. You need a credit card to get a cash advance, and if you have a credit card, you’ll fare much better charging a purchase than taking out a cash advance to pay for it. So why opt for a cash advance? Good question. With “cash only” businesses quickly becoming a thing of the past, there is rarely any reason to.
  2. They come with high APRs. For credit cards, a purchase comes with an average APR of 15 percent. But with cash advances, a 2015 survey found that 86 percent of them charge an APR above 20 percent.[2] Among the 100 cards surveyed by CreditCards.com, the highest rates were:

    Credit Cards

    Cash Advance APR

    First Premier Bank credit card

    36 percent

    BP Visa and Texaco Visa

    29.99 percent

    ExxonMobil SmartCard

    29.95 percent

    Shell Platinum MasterCard

    27.99 percent

  3. You’re immediately charged interest. With credit cards, interest typically isn’t assessed if the bill is paid off within a grace period—usually 30 days. But with a cash advance, interest is tacked on immediately, and a borrower isn’t free from it until the advance—and the interest—is fully paid.
  4. Costly Fees. Another strike against cash advances is that, unlike a charge on a credit card, users are hit with a transaction fee—typically five percent of the amount borrowed.[2]

When should I consider a Cash Advance?

Cash advances are rarely a good idea. They might make sense in an emergency where cash is the only accepted form of payment—say if your car breaks down and the mechanic won’t take anything else. But these situations are rare.

For some borrowers, cash advances are used as an alternative to forms of predatory lending like payday loans and title loans. Some financial analysts view them as “the better of multiple evils,”[2] but the debate about whether they’re better or worse than payday loans is ongoing. The Consumer Federation of America, however, notes that they are less expensive.

Bottom line

Cash advances are expensive and often unnecessary. They should be avoided except in rare circumstances.


  1. Smith, Sandy. “Finance 101: Basics of Cash Advance and Payday Loans” YesIAmCheap.com. January 14, 2011. Accessed on October 10, 2016, at http://yesiamcheap.com/basics-of-cash-advance-and-payday-loans/.

  2. Kossman, Sienna. “2015 Cash Advance Survey: Convenient Cash Will Cost You Plenty.” CreditCards.com. Accessed on October 11, 2016, at http://www.creditcards.com/credit-card-news/cash-advance-survey.php

Considering a Fast Cash Loan? Here are 4 Steps to Get it Right!


If there’s one thing that defines modern life, it’s speed. We get our entertainment, news, and products delivered (thanks, drones!) faster than ever before. And when you’ve had an unforeseen accident or doctor’s bill, the speed at which expenses come at you can seem flat out dizzying. In situations like this, you’re probably looking for a fast cash loan—the one that will get you your funds as speedily as possible.

But just because you need a fast cash loan, don’t rush into a bad financial decision. Take our advice and follow these four simple steps to guarantee a safe, smart, and fast solution for your financial situation.

Compare Rates

You wouldn’t shop for a big-ticket item like a TV or a home appliance without comparing prices. The same should hold true for personal loans.

The best way to compare the cost of a fast cash loan is to learn the annual percentage rates, or APRs, a lender offers. APR describes the cost of a loan over the course of a full year, taking into account the simple interest rate plus any additional fees or charges. With short-term loans like payday and title loans, you should be especially aware of the APR. To see exactly how much you will owe at the end of the year – and whether you can afford it – use an APR calculator and punch in your numbers.

So take your time and compare the rates from lots of different loans. You don’t want to take out a loan that you can’t afford. You can learn more in our article What You Should Know About Interest Rates.

Compare Reviews

If you had a choice between two restaurants, would you pick the one with glowing Yelp reviews or the one that just showed up on the health department’s website for all the wrong reasons?

Reputations matter with lenders too. So check out what other people are saying on Facebook, LendingTree and Google+. If borrowers are complaining about poor service, misleading terms and aggressive collections, then that lender is one to avoid. On the other hand, if people are rating a lender very highly, then maybe that’s one you should check out. (Oh, and in case you were wondering, OppLoans was rated as LendingTree’s #1 Customer-Rated Personal Lender for Q2 2016.)

Read Your Loan Agreement

Don’t skim that loan agreement! Your agreement is a legal document that will detail all the “must-knows” (like interest rate, APR, term, repayment structure, terms and conditions) of the financial arrangement you might be about to enter into. Still, a recent survey found that just 7 percent of people read the small print when purchasing products and services. One fifth of people say they have experienced adverse consequences for not doing so.[1]

So once you’ve decided on a loan, you shouldn’t just sign the agreement and wait for your funds. You should read your loan agreement from front to back to make sure there aren’t any surprises in store. If you’re getting a loan in person, it might be a good idea to take the loan agreement home with you so that you can take the time to fully absorb it. If you’re taking out a loan online, it’s a little easier, since you’re already at your computer. And if you don’t understand something in your loan agreement, you can always Google it, or you can …

Ask Questions

Ask a lot of them. Ask about how the loan’s payments are structured. Ask if the loan is amortizing. Ask about whether there are prepayment penalties and grace periods for late payments and about the lender’s status with the Better Business Bureau (BBB). Penn State offers this handy list of questions to ask your lender when taking out a loan.

Here’s a pro tip: Ask questions to which you already have the answers. If you see one thing in the loan agreement, but get told something else by your loan officer—especially if what the loan officer tells you makes the loan seems better than it actually is—then maybe that’s a lender you shouldn’t be working with. Because remember: You’re not just choosing a loan, you’re also choosing a lender. If you can’t trust them, then their loan is definitely not worth it.

At OppLoans, we believe that you deserve better than a payday loan. That’s why we offer personal installment loans with longer terms (6-36 months) and lower rates (up to 125 percent less) that your typical payday or title loan. Plus, our customers rate us an average of 4.9 out of 5 stars on LendingTree and Google +. We’re a socially responsible lender, which is why we offer safer, more affordable loans that our customer can actually afford to repay.

You can apply for a personal installment loan today. Just fill out our easy, online application and get a decision within minutes. If you’re approved, we can deposit the funds in your bank account as early as the next business day. To learn more, or to apply for a loan today, just check out our homepage: www.OppLoans.com.


  1. Smithers, Rebecca. “Terms and conditions: not reading the small print can mean big problems.” TheGuardian.com. Accessed September 29, 2016 from https://www.theguardian.com/money/2011/may/11/terms-conditions-small-print-big-problems

OppLoans Word of the Week: Cash Advance

Word of the Week- Cash Advance

Your car breaks down on a remote country road. (Don’t worry, this isn’t the beginning of a horror movie.) You manage to call a tow truck, but the driver insists on being paid in cash. He tows you to a gas station, where they have a cash machine. Unfortunately, it’s the day before payday and your bank account is basically 99 percent cobwebs. Looks like your only option is using your credit card and taking out a costly cash advance. Your budget is extremely tight as it is; is this added cost something you’re going to be able to handle? (Okay, we lied. This is a horror movie.)

What is a Cash Advance?

A cash advance is a way for credit card users to withdraw cash when they really need it. They come with much higher interest rates than standard credit card purchases and there is no grace period. That high interest starts accruing the moment the cash hits your hand.[1]

How is a Cash Advance different than a regular credit card purchase?

When a person has a credit card, it’s basically like having a revolving line of credit that they can access directly. Any purchase they make using their card is added to their balance and begins to accrue interest at an average yearly rate of 15 percent. Luckily, people who closely track their spending and don’t spend more on their card than they can afford can avoid paying interest altogether. Pretty much all credit cards have a 30-day grace period before interest starts to accrue on a given purchase. If the person pays off their entire balance every month, their effective interest rate will be 0 percent.

With a credit card cash advance, the amount withdrawn is added to the card’s balance, just like with any credit card purchase.  But that’s where the similarities end. Credit card companies charge higher interest rates on cash advances than they do on standard purchases. The average Annual Percentage Rate (APR) for a credit cash advance is 24 percent! That’s almost 10 percent higher than the average rate on a credit card purchase.[2]

And the added costs don’t stop there. Credit card cash advances also don’t have that same grace period that standard purchases do. Not only are the interest rates higher, but that interest starts to accrue immediately. With a cash advance, there is no possibility of paying your balance off every month and paying 0 percent. Credit card cash advances also come with an added fee, usually 2 to 5 percent of whatever you withdraw.[3] You can read more in The Hidden Dangers of Cash Advances.

Previous Entries:





  1. Konsko, Lindsay. “What is a Cash Advance?” NerdWallet.com. Accessed September 16, 2016. https://www.nerdwallet.com/blog/credit-cards/what-is-a-cash-advance/
  2. Mecia, Tony. “The high cost of credit card cash advances.” CreditCards.com. Accessed September 16, 2016. http://www.creditcards.com/credit-card-news/cash_advances-cost-rates-1276.php/
  3. Martin, Allison. “4 Dangers of Credit Card Cash Advances.” Credit.com. Accessed September 16, 2016. https://blog.credit.com/2013/10/4-dangers-of-credit-card-cash-advances/

Need a Better Fast Cash Loan? Try Skipping the Hassle of Cash.

Need a Better Fast Cash Loan- Try Skipping the Hassle of Cash. (2) (2)

There are times when you just need a fast cash loan, but isn’t there a better, safer way?

It’s a fact: Taking your old jacket out of the closet and finding that random ten-dollar bill in the pocket is the BEST part of fall. Well, okay, maybe not the best, but it’s up there.

That’s the thing about cash: It’s fun, spendable, and great to have in small amounts. Carrying a little cash on hand can feel good, but carrying around a serious amount can be annoying at best and dangerous at worst. That’s why most of us don’t carry much cash anymore. In fact, two out of ten Americans carry less than $20 cash on a daily basis.[1] We’ve switched to other forms of payment that are safer, easier, and more responsible.

According to a recent Federal Reserve Payments Study, 67 percent of consumer payments in 2012 were made with debit or credit cards, up from 43 percent in 2003.[2] And with the rapid growth of mobile payments, like tap-and-pay Google Wallet and Apple Pay, lots of businesses are moving away from cash too. A recent report by Javelin Strategy and Research found that 66 percent of in-person sales are made without cash, and the trend is continuing.[3] In fact, certain airlines, hotels, restaurants, stores and merchants are now adopting “cashless” policies and only accepting electronic payment.[4]

The basic fact is we don’t need cash in hand the way we used to. So why do lots of small-dollar lenders make such a big deal about giving us loans in cash?

Fools’ Gold

Take a look at the advertisements for your neighborhood payday or title lender, and you’ll probably find the word “cash” featured front-and-center. But with a society that’s becoming more and more cashless by the day, the promise of a cash loan is becoming less and less enticing. And it’s not like these loans don’t have their downsides, either. You might leave that storefront lender with a few hundred “new” dollars in your wallet, but what’s it going to cost you when it’s time to pay that money back?

Now that cash isn’t what it used to be, here are some of the “fast cash loan” providers you’ll want to avoid:

  1. Payday Loans: Payday loans are unsecured, small-dollar loans available at storefronts or online. They usually come with short terms (only 14-days) and astronomically high Annual Percentage Rates (APRs)! Sure, you can walk out with cash, but many borrowers find themselves trapped in debt for almost 200 days per year! Learn more about Payday loans here.
  2. Title Loans: Selling your car is one thing, but using it to get a title loan is another. Title loans are cash loans secured with your auto title (or motorcycle, or boat). If you can’t repay the loan, the dealer can repossess your collateral (your car!). So along with those high-interest rates and extra fees, you also run the risk of losing your ride. Learn more about title loans here.
  3. Pawnshop Loans: You know that family heirloom you’ve been entrusted with? If you want to keep it, avoiding pawnshops will help. Pawnshop loans require handing over a valuable piece of personal property to secure a small dollar cash loan. You get to leave the store with cash, but your property stays behind. If you fail to repay, your valuables will be sold to someone else (who frankly isn’t going to appreciate that Black Velvet Elvis painting correctly). Learn more about pawnshop loans here.
  4. Cash Advance: There are several different types of cash advance loans and none of them are good. To get a cash advance, you can either borrow against your credit card (at a higher than normal interest rate), try to secure a paycheck advance from your employer (an awkward conversation neither of you will enjoy), or pursue any number of the “cash advance” consumer loans available from storefront lenders. Skip the hassle, skip the pain, and skip “cash advances” altogether. Learn more about cash advances here.

Cashing Out

Borrowing money is a serious decision. It’s always advisable to do your research and make a responsible choice that’s based on your financial reality—not the needs of the moment. While it might seem reasonable to take out a quick payday loan so you can have that cash in hand, isn’t there a better way? You bet there is.

OppLoans personal installment loans are “cashless”, meaning your loan will be deposited directly into your bank account. After a convenient online application process you can complete on your phone, computer or tablet, you could be approved for the loan you need almost immediately. And if you’re approved before 7:30 p.m. ET Monday—Friday, you’ll typically receive the money in your checking account by the next business day. If you do need hard cash, you can make a withdrawal from your bank or an ATM.

It’s 2016 and the simple fact is cash is no longer king. You don’t need to be trapped by small-dollar, fast cash lenders. With options like OppLoans, there are better, smarter, safer ways.


  1. Kieler, Ashlee “Study confirms that most of us carry less than $50 cash” Consumerist.com. Retrieved September 12, 2016, from https://consumerist.com/2014/05/12/study-confirms-that-most-of-us-carry-less-than-50-cash/
  2. Holmes, Tamara “Payment Method Statistics” CreditCards.com. Retrieved September 12, 2016, from http://www.creditcards.com/credit-card-news/payment-method-statistics-1276.php
  3. Overfelt, Maggie “Cash-only business owners risk $100 billion mistake” CNBC.com. Retrieved September 12, 2016, from http://www.cnbc.com/2013/11/12/cash-only-business-owners-risk-100-billion-mistake.html
  4. Saranow Schultz, Jennifer “The Mercahnts That don’t Take Cash” NYTimes.com. Retrieved September 12, 2016, from http://bucks.blogs.nytimes.com/2010/06/08/sorry-no-cash-please/?_r=1

A Crash Course in Credit Card Cash Advances (3 of 3): Better Alternatives

Credit Card Cash Advances Better Alternatives

There are options far more affordable than cash advances — options that won’t leave you in worse financial shape than you were before. Here are OppLoans’ recommended alternatives to credit card cash advances.

As with other financial products, credit card cash advances have advantages and disadvantages. While you can use a credit card cash advance to access cash quickly, they carry extremely high rates, charge additional fees, and offer no grace period—which means interest starts accruing immediately.[1] If you do your research you can decide, with confidence, whether a credit card cash advance is right for you and your financial situation.

Borrowing from Friends or Family

This option is completely dependent on your specific situation. Do you have a friend or relative that’s able to lend you the money you need to tide you over until payday? If so, this may be a good idea. Odds are that if you’re borrowing from a loved one, they’ll either give you a good deal or not charge you any interest.

When approaching a friend or family member for a loan, be prepared with details. You should be professional, know exactly how much you need, and set a firm date by which they’ll be repaid. Being prepared with all of the details will make it easier for them to help you out. It’s recommended to have a written agreement. If you want things to be official, you can get the agreement notarized, which makes it a legal document. Whether or not you choose to do that, it’s important to treat a family loan just as you would a bank loan and pay it back on time.

This can be a risky option as failing to fulfill the terms of the agreement could have a negative effect on your relationship. Keep those family get-togethers pleasant, or at least less awkward than normal!

Find a Credit Union

Taking out a loan from a credit union can be another good alternative to credit card cash advances. Credit unions are small, non-profit, local banks that are controlled by their members rather than shareholders. You have to apply to become a member, but if accepted you may be rewarded with lower rates than you would find at a normal bank.

The rates on a credit union loan will undoubtedly be better than a payday loan, title loan, or credit card cash advance. You can learn more about credit unions in our Financial Smarts Glossary.

Rely on OppLoans

If you’re in a financial bind and you’re looking for a fast loan that’s safer and more affordable, then OppLoans is the place for you. You’ll get better rates (up to 125% lower than payday loans) and a caring and helpful experience. Our personal installment loans offer as much as $10,000 and come with regular, fixed-rate payments. You’ll always be able to find a loan amount that fits your budget, and there will never be any surprise fees.

OppLoans is the alternative to credit card cash advances that offers you fast funding, lower interest, and a more personal experience. Click “Apply Online” below to get started today!


[1]“Cash Advance” InvestopediaInvestopedia.com Accessed May 14, 2016.

[2]“How to Borrow Money with Bad Credit” WikiHow.WikiHow.com Accessed May 14, 2016.

A Crash Course in Credit Card Cash Advances (2 of 3): Know the Dangers

Know the Dangers

“Fast cash” products like credit card cash advances may seem like your only option if you’re facing a tough time financially, but do a little research and you’ll quickly see that credit card cash advances should be high on your list of things to avoid.

There’s plenty to say about the dangers of predatory payday and title loans—but did you know that credit card cash advances can be almost as expensive? Just like predatory loans, credit card cash advances can damage your financial future.

The most common dangers you can expect to encounter with a credit card cash advance include:

Sky-High Interest Rates

You’re probably used to using your credit card the traditional way: buying a big ticket item like air travel or a home appliance and then paying it off. But using your credit card to get a cash advance works differently, and has much more dangerous consequences.

A standard credit card purchase carries about 18% interest. The longer the debt is outstanding, the more interest accrues, and the more expensive that purchase you made becomes. But with credit card cash advances, the interest rate is much higher: 24.4% on average.[1] Credit cards are already an expensive tool. Why make it more difficult for yourself by using credit in this much riskier way?

Additional Fees

Okay, so you’ll be paying higher-than-normal interest with a credit card cash advance. Maybe you can live with that—you might not like it, but hey, this is an emergency, right? Well, hold on … because it actually gets worse.

On top of those enormous interest rates, you’ll also be on the hook for additional fees and charges like a cash advance fee of 3% with a minimum fee of $5-$10.[2] These fees may seem small but they add up. And frequently, they’re disguised with vague names like “finance charges” and “convenience fees”. If you opt to use an ATM to take out your advance, you’ll also be hit with an ATM charge.

So now you’re not only paying more interest to have this cash on hand, you’re also paying fees to be able to get it! It’s easy to see how quickly the value of a credit card cash advance slips away. Read more in Cash Advance Loans: Payday Loans Under Another Name.

No Grace Period

Okay, so now we’re borrowing against our credit limit at higher-than-average rates plus fees. It can’t get worse than that, right? Well let’s take one last look at the ugly truth about credit card cash advances and see…

A grace period is the amount of time between making a purchase, or taking out a loan, and when interest starts to accrue. For instance, when you make a purchase with your credit card, the interest won’t begin adding up immediately. You may have a month or so to pay off that purchase before you’re charged any interest at all. That means if you pay off your balance before the interest starts to build, then the cost of borrowing is zero.[3] When you use your credit this way—correctly—credit cards seem like a pretty useful tool. But this isn’t the case when you take out a cash advance.

With credit card cash advances, interest begins accruing the second you have that advance in your hand. Remember that higher-than-average interest rate. Now you’re paying it immediately!

At the end of the day, credit card cash advances are a misuse of credit cards. People turn to them when they think they have no other options. But often, they do! If you’re facing a financial hardship and need cash in hand quickly, don’t turn to a destructive credit card cash advance. Instead, consider a safe and strategic personal loan from OppLoans. Our installment loans and line of credit products are fast, easy, and transparent—you’ll always know exactly what you’re getting—and we never charge pre-payment fees.

Click “Apply Online” below to get started today!


[1]Parker, Tim “How A Cash Advance Works” Investopedia.com Accessed May 14, 2016.

[2]Steele, Jason “5 Credit Card Fees You Should Never Pay”Credit.com Accessed May 14, 2016.

[3]Konsko, Lindsay “What Is A Cash Advance?” NerdWallet.com Accessed May 15, 2016.

A Crash Course in Credit Card Cash Advances (1 of 3): The Basics

CCC The Basics

Tough times happen. When money gets tight, some people will turn to credit card cash advances to get by, but the dangers often far outweigh the benefits. Here’s everything you need to know to prep for a financial challenge.

Credit card cash advances can seem helpful because they’re fast, but you’ll often find that the long-term results are dangerous amounts of debt, mounting fees, and worsening spending habits. Protect your money and your credit by taking the OppLoans Crash Course in Credit Card Cash Advances.

What is a Credit Card Cash Advance?

People regularly use credit cards for daily purchases or big-ticket items like appliances, car repairs, or other big surprise expenses. Knowing how to use a credit card responsibly can provide you with options you might not normally have. For instance, say your computer crashes unexpectedly. You may not have enough cash on hand for a new one right now, but a credit card allows you to make that purchase and pay it off over time.

Making payments on time even helps build your credit score (resulting in a higher credit limit).

You can also use your credit card to withdraw cash. This is similar to taking out cash at the ATM or some retailers using a debit card, but the money doesn’t come from your checking account, it comes out of your credit limit–which is, technically, money you don’t have yet. Essentially, you’re taking out a short-term, small-dollar loan. This is a credit card cash advance.[1] It seems easy … almost too easy.

How Does It Work?

Well, it may seem obvious, but the first thing you’ll need to obtain a credit card cash advance is … a credit card (crazy, we know). There are a few different methods for obtaining a cash advance from your credit card provider. You can withdraw cash from an ATM the same way you would with a debit or check card. In order to do this, you’ll need to have a PIN number set up through the card provider. If you don’t have a PIN, you’ll need to contact the credit card company to set it up (read more in What You Should Know About Cash Advance Loans: An interview with financial expert Ann Logue).

You can also withdraw money from a bank teller. This may be wiser than using an ATM, as a bank teller can answer any questions you may have about the transaction and the fees. Some banks may even charge less for withdrawing money from a teller. Make sure to ask questions and know what fees and charges you’re agreeing to prior to receiving your advance.

Convenience checks can also be used to collect a cash advance. These are similar to standard checks, but they’re associated with your credit card account instead of your checking or savings account. Companies will occasionally mail these to customers along with special offers like 0% APR for a limited time.[2]

How Much Can You Get?

The amount you can withdraw will vary depending on several factors. First, it will depend on the cash advance limit set by your credit card company. It will also depend on your credit standing. If you have a low credit score, you may not be eligible for a high credit limit. With a good credit score, your credit limit for both purchase transactions and cash advances will be higher. Make sure you know your credit limit, because maxing out a credit card will negatively impact your credit score. Odds are you’re not going to get very much with a credit card cash advance. When you add up all the risks, the low advance amount often doesn’t make these risky maneuvers worth it. Learn more about the risks in The Hidden Dangers of Cash Advances.

The most important thing to remember is to ask questions. If you’re unclear about how something works or how much you should withdraw, even about whether you should even get a credit card cash advance at all—ask questions. Do your research and make sure that you’re making the best decision for your financial future.

True or False: Credit Card Cash Advances are a Risky Choice

This is an easy one. Borrowing against money you don’t have is always a gamble.

If you’re looking for a safer way to borrow, consider a personal installment loan from OppLoans. Our loans have longer terms (up to 36 months), more flexible repayment plans, and we report on-time repayments to build your credit. Click “Apply Online” below to get started today, and congrats on skipping that dangerous credit card cash advance. We knew you were too smart for that!


[1]Konsko, Lindsay “What is A Cash Advance?”NerdWallet.com Accessed May 13, 2016.

[2]“What is a Credit Card Cash Advance?”ValuePenguin.com Accessed May 13, 2016.

Heavyweight Loan Showdown (3 of 3): Credit Card Cash Advances VS. Pawn Shop Loans

Heavyweight Showdown

And we’re back again for the final Heavyweight Loan Showdown! Tonight, the undefeated Credit Card Cash Advance returns for a championship faceoff against predatory Pawn Shop Loans.

Expensive, unfair, and painful, these contenders look evenly matched for the title of Most Dangerous Loan.

Round 1

Credit Card Cash Advances blast out of the corner looking ferocious. This small-dollar, high-interest loan eats borrowers for breakfast and it shows: higher interest than regular credit card purchases, additional ATM fees and finance charges, and no grace period to speak of. This perfect storm of jabs and hooks is almost impossible to defend against.

A credit card cash advance means withdrawing cash through your credit card, and it’s a dangerously simple process. If you have a credit card, you’ll want to check with your provider to find out the terms and conditions. Generally, you’ll withdraw the cash from an ATM or a bank teller. According to a 2015 survey, the average APR for a credit card cash advance is 23.5%[1], which is generally much higher than the borrower’s regular credit card APR (typically 14.99%).

In this round, Credit Card Cash Advances takes early control.

Round 2

There’s the bell and Pawn Shops Loans comes out swinging.

To get a pawn shop loan, you’ll be required to offer the lender a valuable item in exchange for cash. Common items used as collateral include jewelry, electronics, musical instruments, and more. Once the “pawn broker” agrees to accept your item, they’ll give you a cash loan for approximately 25% to 60% of the item’s value. Because you’re not getting the full value, the average loan is a small-dollar deal, generally only $75-$100.[2] Borrowers are then given a short amount of time to repay the loan and reclaim their property. If they aren’t able to repay the loan, the pawn shop will sell their item. This devastating combo forces Credit Card Cash Advances against the ropes.

In addition to the low loan amounts, and the short repayment period, pawn shop loans will likely also include high interest rates and fees. On average, you’ll be charged about 10% per month to borrow, which comes out to 120% APR. The rate you get will depend on the laws in the state where you live. You may see rates from 12% to 240%.[2]—a stiff uppercut to the jaw of Credit Card Cash Advances!

Round 3

But Credit Card Cash Advances answers back with another pounding series of blows to the gut. Credit Card Cash Advances digs deep and fires their strongest attack yet: building a habit of bad spending behavior.

Credit card cash advances are really only good for worst-case-scenario emergencies. Borrowing against money you don’t have is like swiping your credit card at a slot machine (which can happen now!). Most credit card holders don’t use cash advances (only about 3% do[1]) and for good reason. But if you start using them with any kind of regularity, you can quickly find your debt growing and your financial control slipping away. That’s the knockout punch.

The Most Dangerous Loan

And it’s over! Credit Card Cash Advances takes the tournament!

When it comes to “Dangerous Loans” there’s no shortage of contenders: Credit Card Cash Advances, Pawn Shop Loans, Employee Salary Advances, Title Loans and more. The world of lending can be a scary arena filled with brutal opponents trying to out-muscle the borrowers every way they can.

If you’re in financial need, avoid the pain of these dangerous loan types and choose a safe, proven, reliable option with OppLoans. Our personal loans are transparent, lower cost, and delivered with caring service. Click below to get started today. Don’t let predatory loans leave you down for the count!


[1] Kossman, Sienna. “2015 Cash Advance Survey” CreditCards.com Accessed May 13, 2016.

[2] Reiter, Margaret. “Disadvantages of Pawnshop Loans.” Nolo.com Accessed May 17, 2016.

Blog Series: Heavyweight Loan Showdown
Part 1: Credit Card Cash Advances VS. Payday Cash Advances
Part 2: Credit Card Cash Advances VS. Employer Cash Advances
Part 3: Credit Card Cash Advances VS. Pawn Shop Loans

Heavyweight Loan Showdown (2 of 3): Credit Card Cash Advances VS. Employer Cash Advances

Heavyweight Showdown

Welcome back for another heavyweight loan showdown! Tonight we have employer cash advances going toe-to-toe with credit card cash advances. Which of these two loan types is more dangerous for consumers? Let’s step into the ring and find out.

Round 1

Employer cash advances steps out of its corner looking scrawny and weak. An employer cash advance doesn’t have much weight—it’s just borrowing money from a future paycheck at work.

Some companies have policies that allow this type of loan, some handle it more informally (like under the table), and many don’t allow it at all. Employer cash advances aren’t particularly dangerous because you’re just borrowing against your anticipated earnings—but they’re not particularly useful either. You may get a little extra money now, and a little less in your next paycheck. Not very risky and not very helpful. You might call this type of loan a ‘featherweight.’

Employer cash advances takes a big swing at credit card cash advances but misses entirely. Credit card cash advances counterattacks with a frenzy of haymakers.

Interest on credit card cash advances isn’t just high, at 23.5% it’s much higher than the 14.99% interest charged on regular purchases. And then there are the extra charges like ATM fees that make these loans far tougher than employer cash advances.

Everyone knows credit card cash advances are bad news, but worst of all? No grace period before interest rates start to accrue! You’re not only paying high interest, but you’re paying that high interest immediately (learn more in The Hidden Dangers of Cash Advances). Employer cash advances hit the floor…and they aren’t getting up. A first round knockout!!!

The More Dangerous Loan

Neither of these loan types are good. Employer cash advances may be weak but they can destroy your reputation at work (who wants to be seen as the employee who can’t manage their money?). A credit card cash advance, though, is a heavy hitter: extra high interest, additional fees, and no grace period make these loans worth avoiding.

Why not skip both of these bad choices and go with a safe, secure personal installment loan from OppLoans. Our financial products are fast, reliable, and can help you build credit. Apply today to get started!

Blog Series: Heavyweight Loan Showdown
Part 1: Credit Card Cash Advances VS. Payday Cash Advances
Part 2: Credit Card Cash Advances VS. Employer Cash Advances
Part 3: Credit Card Cash Advances VS. Pawn Shop Loans

Heavyweight Loan Showdown (1 of 3) : Credit Card Cash Advances VS. Payday Cash Advances

Heavyweight Showdown

If you need fast cash, you have options. While some are safe, most are dangerous and predatory. In the world of heavyweight lenders, who’s the baddest of the bad?

In the left corner we have credit card cash advances: A short-term loan product offered through most credit card providers–and a way to get fast cash at a high cost.

And in the right corner we have payday cash advances: Another high-dollar, short-term loan offered to borrowers in tough financial situations.

It seems like an even match-up. Let’s see which of these costly loans has what it takes to make it all 12 rounds and claim the title of Most Dangerous Loan.

Round 1

A payday cash advance is a small and expensive loan that people use to make it to their next paycheck. To get a payday cash advance, a borrower gives their lender a post-dated check, or access to their checking account. The check will be for the amount of money they’re borrowing, plus interest and any additional fees. The borrower then receives a cash loan that’s usually due back in two weeks, or on the borrower’s next payday. These loans are ferocious, and they’re coming out of the corner strong.

Credit card cash advances won’t go down without a fight however. This type of loan draws cash from your credit card balance. This can be done at an ATM or with a bank teller. There are usually several fees involved, and the interest is also 8.5% higher than normal credit card purchases.[1] It’s those tall interest rates and fees that make credit card cash advances a formidable opponent.

Round 2

Payday cash advances are taking jab after jab from credit card cash advances. If you withdraw cash using your credit card, don’t expect the average APR of 15%… more like 23.54%. Jab. You’ll also see additional fees like a “finance charge” or “ATM fee”. Jab. But payday advances don’t seem to be phased by these punches.

Now payday advances are throwing round-house punches. The average APR for a payday cash advance can be anywhere between 390% and 780% depending on where you live. Different states have different laws and regulations on payday loans.[2] But the average payday borrower will pay over $450 to borrow $350.[3] A devastating blow.

Round 3

The most dangerous aspect of a credit card cash advance is their grace period… There isn’t one. This means the interest begins building up right away. It’s the powerful uppercut of credit card cash advances, and it knocks payday advances to the ground. But not for long.

Payday advances pop right back up, spits out its mouthguard, and keeps fighting with more ferocity than ever. Payday advances take advantage of borrowers through a practice known as “rollover”. To rollover a loan means the lender extends the loan another term, and charges additional fees to do it. 76% of payday loans are taken out within two weeks of a previous payday loan. And people who use these loans take out an average of 8 to 13 loans per year with the same lender.[2] This is a stunning barrage of jabs, left hooks and uppercuts. It looks like these two are battling to a standstill!

The Most Dangerous Loan

These brutal loans have battled to a draw. They’re both expensive, predatory and worth avoiding. Credit Card Cash Advances are a bad habit to fall into and Payday Advances are a quick way to lose control of your finances. Our advice is to steer clear of both of these loans.

Instead, consider a safe, reliable personal installment loan from a reputable lender like OppLoans. If you’re on the ropes financially, we can help. Click below to apply for a loan today!

Read the other parts of the series:


[1] Kossman, Sienna. “2015 Cash Advance Survey”CreditCards.com Accessed May 13, 2016.

[2] “How Payday Loans Work.” Payday Loan Consumer Information. PaydayLoanInfo.org Accessed May 13, 2016.

[3] Standaert, Diane. “Payday Loan Quick Facts: Debt Trap by Design” ResponsibleLending.org Accessed May 13, 2016.

Blog Series: Heavyweight Loan Showdown
Part 1: Credit Card Cash Advances VS. Payday Cash Advances
Part 2: Credit Card Cash Advances VS. Employer Cash Advances
Part 3: Credit Card Cash Advances VS. Pawn Shop Loans