In a financial emergency, a cash advance can help you quickly get the money you need. So how do cash advances work and what are the different types? Most importantly, how much can you borrow—and what will it cost?

Here’s a simple guide to understanding the different types of cash advances, including all the details to help you decide if a cash advance is right for you.

What is a cash advance?
A cash advance is a short-term cash loan intended to cover an unexpected expense or emergency.

There are three main types of cash advances: credit card cash advances, personal installment loans, and payday loans. All of these options can deliver cash in a hurry, but each works a little differently. Here’s what you need to know about your choices.

Credit card cash advance

How does it work?

You can go to an ATM or bank and use your credit card to immediately withdraw cash. No credit check is required.

How much can you borrow?

Most credit card companies limit your cash advances to an amount smaller than your credit limit.

What are the costs and how do you repay it?

First, you’ll pay a cash advance fee and possibly an ATM fee. Then, you’ll pay interest on the borrowed money.

Interest on credit card cash advances starts accruing immediately, and the interest rate is generally higher than your standard credit card interest rate. The cash advance becomes part of your credit card balance, which you can pay down monthly (or more frequently, if you choose).

Could this be a good option for you?

A credit card cash advance might be an attractive option if you already have a credit card, haven’t maxed out the credit limit, and need cash immediately. It’s also a good option if you don’t want to submit any type of application or have your credit checked.

Installment loan

How does it work?

You can apply for a personal installment loan from an online lender, bank or credit union. Lenders will usually check your credit as part of the application process.

If you’re approved, the money is usually available within a few business days—or sometimes as soon as the next business day.

How much can you borrow?

Loans range from a few hundred dollars to several thousand dollars, depending on the lender and the state where you live.

What are the costs and how do you repay it?

The loan will have a fixed interest rate and a pre-determined length, anywhere from a few months to a few years. You’ll make regularly scheduled payments, usually biweekly or monthly. Each payment will be the same amount, and you know when you’ll be done with the debt.

Could this be a good option for you?

If you need to borrow a larger amount, a personal installment loan could be the right fit for you. Personal installment loans are also a good choice for borrowers who like to make regular, steady payments, and need more than a few weeks to pay back the loan.

Payday loan

How does it work?

You can apply for a loan from a payday lender online or in person. Funds are usually made available the same day.

How much can you borrow?

Payday loans range from $100 to $1,000, depending on the state.

What are the costs and how do you repay it?

Lenders typically charge a fixed, flat fee based on the amount borrowed. You have until your next payday to pay off the amount borrowed plus the fee—all at once.

Could this be a good option for you?

If you can repay the loan and the fee on your next payday, this type of cash advance could work for you. Payday loans could also be a good fit if you only need to borrow a small sum for a few weeks or less.

Learn more about installment loans

RISE offers personal installment loans that can help with a financial emergency. With a RISE online loan, you can borrow up to $5,000 and usually get the cash within 1-2 days.

Plus, RISE can help you rebuild or improve your credit with free credit monitoring and financial tools designed to get you on track. Apply today and find out if you qualify within minutes.

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