Beware of those hidden cash advance fees on credit cards

Credit cards are a great way to manage your spending, as long as you use them carefully. Do it wrong, and you could accumulating debt and ruining your credit rating. You can check https://oakparkfinancial.com/merchant-cash-advance/ so you can get cash advance with no hidden fees.

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There is also another danger, less publicized …

Advance Fee

If you’re not careful, you can quickly start racking up additional hidden costs without realizing what you are doing. One of the most expensive and confusing of the cash advance fees. It surprises a lot of people just because they don’t know what it is. Others know it, but don’t realize when it applies.

So what is a cash advance?

Users most often pay the cash advance fee when they withdraw money from their credit cards.

Despite the danger, half of us don’t even realize ATM withdrawals come with a fee, according to a new study from credit experts TotallyMoney.

Instant interest

The cash advance fee is charged as a percentage of the amount spent on the card during the transaction. This percentage is usually 3%, with a minimum of £ 3. So if you withdraw a quick tenth to help you out, you could pay a fee equivalent to 30% of your withdrawal.

The cash advance fee will apply even if you have an introductory rate credit card that charges no interest on new purchases.

The other downside to withdrawing money to your credit card is that you don’t get the usual 55 days without interest on purchases, but start paying your card’s APR the moment you get these tickets in hand.

Therefore, only use your credit card at an ATM in an emergency. Stick to your debit card whenever possible.

Could you be rewarded for your daily expenses?

Reward credit cards include programs that simply reward you for using your credit card. When you spend money on a rewards card, you can earn loyalty points, store vouchers, airline miles, and more. MyWalletHero makes it easy for you to find a card that matches your spending habits so you can get the most out of your rewards.

It’s just not clear

Even fewer people realize that you may incur cash advance fees on other transactions, such as when buying currency from a bank or bureau de change.

There is often a cash advance fee even if you purchase one of these brilliant travel credit cards with no charges for use abroad. They can waive all fees on overseas purchases, but the majority still charge a cash advance fee on ATM withdrawals and charge interest immediately.

You may also be surprised by other transactions …

It’s a bet

If you like to flutter, the cash advance fee could eat into your winnings. If you’re crazy enough to gamble online, there is a cash advance fee on your wager. The same goes for a lottery ticket, including the online versions. Oddly, even an entry fee for a fantasy football team is classified as a game of chance.

Most incredible of all, the purchase of a gift card is considered a cash equivalent transaction.

In any case, you also start paying the APR on your card immediately.

No more disadvantages

It should also be known that cash advances are generally exempt from reward programs.

Most importantly, cash advances may show up in your credit history report. If lenders find that you regularly withdraw money from a credit card, they will suspect that you have bad financial habits and may be reluctant to grant you a mortgage, loan, or new card.

Do your research

Cash advance fees should be easy to avoid, either by paying with a debit card or by cash, whichever is more appropriate.

Issuers should do more to inform customers of the additional charges, but in the meantime, you have to deal with it yourself. Check your credit card statements every month; you might be shocked at what you find.

How These 5 Must-Have Credit Cards Could Help You …

We all know that a bad credit history makes it difficult to borrow money – but did you know that improving your credit score could also help you lower interest rates on credit cards? that will save you hard earned money?

Find out how you could improve your credit score and your chances of applying for credit with our free report “5 things to know before applying for a credit card”.

Just enter your best email address below for instant access to your free copy.


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