Despite today’s great news for the jobs market, and an uptick in new employment data, the overall economy is not in stellar shape and you can expect many consumers will again be trying to make ends meet this holiday season. When the holiday season arrives, it can be stressful and overwhelming to consider paying your bills, putting food on your table and purchasing gifts for your family and loved ones. If you are having trouble with purchasing holiday gifts this year, there are many solutions. One of the solutions that soars in demand during the holidays is taking out cash advance loans.
What are Cash Advance Loans?
Cash advance loans are quick cash loans that are often approved within a few hours to a few days to easily loan cash to one’s bank account. Cash advance loan options often require the borrower to payback the full amount of the loan with interest by a specific date that is agreed on upon being approved for the loan.
Who Qualifies for a Cash Advance Loan?
Getting a cash loan in advance often requires proof of income and in some cases, a positive credit score. Although it is possible to receive approval for a quick cash loan in advance of your next payday even without credit (or poor credit), it is important to determine whether or not you are capable of paying the loan back in full on its due date, with interest (to avoid additional fees and costs).
The Pros of Taking Out a Cash Advance Loan
Taking out a quick cash loan in advance allows you to get the money you need for nearly any purposes whether it is personal, for business or even for a medical emergency you may be faced with yourself. Many times, advance loans of cash can be given and granted without a great credit score, opening up the opportunity for even more to get the cash they need during tough times.
Additionally, quick cash advance loans are often approved and deposited within 72 hours, allowing the borrower to gain access to the funds he or she needs in as little as a few days from applying for the initial loan. Most often, loans can be approved as long as the borrower is able to post collateral or has proof of income.
The Cons of Cash Advance Loans
A major drawback of taking out an advance loan of cash is the interest that is often required to be paid back by a specific date and time. If the loan is not paid back in full and with interest, the borrower will be required to pay even more in total with compounding interest, which can ultimately lead the borrower into even more debt than previously before withdrawing the loan. Cash advance loan rates are often much higher than traditional loan rates due to their quick approval rate and speed.
Additionally, cash loans that are given in advance do not offer much recovery time before interest rates soar, so taking out a loan during the holidays can be potentially risky for households who are already struggling to pay bills throughout the year.