Managing an Instant Cash Advance Loan Responsibly

While an instant cash advance loan can be a savior to your personal finances in an emergency, it can also become your greatest financial bane. Instant cash advances are instant because they neither require collateral nor a credit history check. Instead, you need only show some proof of regular income or a pre-approved line of credit such as a credit card, and you can get an instant cash advance. This type of loan is particularly risky for the lender, so, to make the business profitable, lenders charge exorbitant fees and interest rates for these short-term loans.

To make sure that an instant cash advance loan helps you stay out of financial trouble rather than make trouble for you, you should resort to an instant cash loan only when it is absolutely necessary to keep you from accruing dangerously high penalties, bad credit, or job loss. Take out only as much money as you need. If, for example, you can get part of your funds from family or friends, then it is better to use those personal resources and then turn to a cash advance to cover the remaining expenses rather than use a loan to cover all the expenses.

Instant cash advance loans are a last resort because they are expensive in several ways. Advance payday loans and most bank loans have an upfront fee, and all short-term loans have the highest interest rates in the industry. The interest is accrued over the period of the loan and is compounded daily. That means that you pay for every day between the day you take out the loan and the day you repay it, and each day is more expensive than the day before it. Hence, it is best to repay the loan as soon as possible rather than wait until the last minute. If you cannot pay back the loan on or before the predetermined due date, make sure to contact the lender as soon as possible to arrange an extension. While you will have to pay for the extension, it is much cheaper than paying late fees. If you do not abide by the repayment scheme that you agree to when you take out the loan, then the lender can cash the post-dated check you provided when you received the loan or otherwise obtain the funds from you forcibly and at a much higher cost than if you had repaid the loan according to the original agreement.

The take-home message is to minimize the amount you borrow in the form of instant cash advance loans, and to repay them as quickly as possible to avoid additional financial woes.

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