Cash Advance Alternatives

Cash Advances are meant to keep you financially afloat between pay periods and therefore are meant to be paid back as early as your next paycheck. That is one of the reasons states can cap the maximum amount to be borrowed at as low as $500 or as a percentage of your monthly income.

How They Work

When you take out a loan, you generally fill out an application and provide the lender with personal and banking information so that the funds can be automatically deducted from your account on the agreed upon due date. By submitting your request, you are agreeing to pay the fees and interest as set out in the agreement. When the due date arrives you have a couple of options:

• allow the company to withdraw the money for the loan as agreed
• go to the company and pay off the loan (if they have a physical store)
• extend or rollover the loan as allowed by state law (there are often limits to the number of times they can be extended; check your state law.)

Seek Out Alternatives to Cash Advances

It's important to see these loans as only temporary, secondary solutions. Before you sign, consider the following alternatives:

• A personal loan from your family or friends,
• A loan from a bank or a credit union,
• A payday advance from your employer,
• Obtaining a cash advance on your credit card
• A secured loan through a pawn shop,
• Refinancing your home or
• Taking out a home equity loan

Additional Alternatives

Contact your creditors directly and request more time to repay your debt. Make sure you find out about any late charges, fees or interest that will be incurred for this service. One way to avoid the need for credit is to plan ahead.

• Create a daily or monthly budget and stick to it
• Think about purchases before you make them- do you really need that?
• Start building up your savings. Even if you start small (5%, for example) it will build faster than you know it.