How to Use Cash Advances on Credit Cardsby Alicia Bodine
Every credit card you are issued gives you a spending limit or a credit limit. This limit can be anywhere from $500 to thousands of dollars. When you take a cash advance on your credit card, you are taking some of that limit out in cash. You will owe that money and there will be fees attached. The amount you can withdraw from a cash advance is not as high as your actual credit limit.
Call the 1-800 number on the back of your credit card and use the automated system to find out how much your cash advance limit is. This is a different figure than the credit limit you received when you got your card.
Use your credit card at almost any ATM and withdraw the amount you need up to the cash advance limit placed on your card. The cash will then be dispensed to you the same way it would if you were using a debit card. You will also need a PIN number to get the cash advance. If you don't know what your PIN number is, you will have to call the 1-800 number on the back of your credit card and request it. They may not give it to you over the phone, but they will send it to you in the mail. This is for security measures.
Use one of your cash advance checks. You will periodically receive checks in the mail that you can use to take a cash advance. You can also call the 1-800 number on the back of your credit card and request some. They will send them to you free of charge, but there are charges for using the checks. To take the cash advance just make the check out to yourself and cash it at your local bank.
Know your fees. An ATM might charge you fees for using it on top of the fees from the credit card company. The credit card company will charge you anywhere from 1 to 4 percent of the amount you took out for starters. Then they will charge you a higher interest rate than you are paying on your card. Finally, they will begin charging you as soon as you take out the money and not a month later like your credit card transactions. All of these fees added together can make it quite expense to take out a cash advance. Speak to your credit cards customer service department to get the fee details for your cash advance.
- Withdrawal only as much money as you need and not a penny more. That will keep you from going in to any further debt.
- Pay back the amount owed as soon as possible to keep the fees and charges at the lowest amount possible.
- Using a cash advance on your credit card should be your last option. The fees are higher than paying for whatever you need in another fashion. You can quickly go in to debt using cash advances.
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