A Cash Advance Definition
If you're in financial trouble, you've probably heard of the payday loan or the cash advance and how it can help get you through the situation. You may not know exactly what a cash advance is, however. The actual cash advance definition varies slightly from lender to lender, but all cash advances have certain things in common that distinguish them from traditional loans.
The first thing to clarify about a cash advance definition is what exactly a cash advance is. Like any other type of loan, it involves you taking a certain amount of money out from a lender for a certain length of time, but the actual amounts and times involved vary significantly compared to most loans. The average length of a payday loan is ten days, and the average amount is $200 to $300.
Once you are approved for a payday loan or cash advance (definition varies depending on the lender; some distinguish between the two while others treat them as the same thing), the lender will send you a loan offer with the exact terms and conditions they propose. You read through the offer (or multiple offers if you applied to multiple lenders), accept one, and sign the contract. The money is transferred to your bank account within a day, and they will leave you alone for the term of the cash advance.
At the end of the term, you repay the loan plus interest (and any fees imposed because of late repayment or other problems). Then, you're in the free and clear once more. Of course, this cash advance definition isn't universal, as some lenders expect you to repay the full amount immediately and others will let you roll over the balance to the next loan period for an extra fee.
Another thing that should be mentioned in a cash advance definition is the wide variety of advances available. Some advances are for bad credit consumers, and they tend to have higher interest rates and fees. Others are “regular” advances that require a credit check, but you are still more likely to be approved than with a traditional loan.
Now that you're clear on what the cash advance definition is, you can decide whether or not a cash advance is right for you. After all, if it is, you can reap the incredible rewards of financial freedom with careful use of the right cash advance.