How To Get Money From A Credit Card In A Cash Advance
- Getting money off your credit card is called a cash advance, and it’s a way of borrowing money over your credit limit.
- Experts generally advise against taking a cash advance, which is one of the most expensive ways to borrow money due to high fees and high interest rate on the money you borrow.
- If this is really the only option available, you can withdraw money from your credit card by going to a bank branch or an ATM.
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Despite our best intentions to diligently save in an emergency fund, sometimes life does.
When events cause an immediate need for cash and you don’t have an emergency fund or other place to get cash, getting cash with your credit card may be an option.
Cash advances – borrowing money with your credit card – are notoriously expensive, and experts generally advise against them. Unlike debit cards, credit cards are generally not used to withdraw money, so in addition to fees – which vary by card – the interest rate on money borrowed through a cash advance is over 23%, compared to the average interest rate for regular credit card balances, or about 17% as of May 2019.
The Experian credit bureau recommends asking the following questions before withdrawing money from your credit card:
- Is the cash advance an emergency to pay an invoice or an expense?
- Can you pay back the money in a month or in a few months?
- Can you borrow money from a friend or family member?
- Do you really need to buy what you are about to buy?
- Do you need help improving your personal finance habits?
If you know that withdrawing money from your credit card is your best option and that you can pay it off before it earns interest, here’s how to get a cash advance.
How To Get Money With A Credit Card
1. Gather your information
Before you can withdraw cash, you must make sure you have your physical card, as well as your account number and PIN code.
2. Find out if your card offers cash advance options.
Before you can borrow money with your credit card, you need to know if your card allows it. Most do these days, and a quick check of your last statement, a visit online, or a call to your bank can help you verify.
3. Understand the terms
Borrowing money from your credit card this way will likely incur fees and interest, and it’s important to understand exactly what you’re getting into before you withdraw the money. Creditcards.com has found that, as a general rule, the fee for withdrawing money from your credit card is 5% of the amount you withdraw, or $ 10, whichever is greater.
4. Find out how much you can borrow
The amount of money you can get from your credit card varies depending on the type of card you have. Again, you can usually find this information on your last statement or online, but a call to your bank will help sort it out as well.
5. Determine how you physically want your money back
Your main options are going to your bank branch in person or going to the ATM.
If you decide to go to a bank instead of withdrawing from an ATM, make sure the bank you are visiting offers advances from your specific credit card company. You can call ahead and ask, or run a quick Google search to find out.
If you’re heading to an ATM, make it an ATM affiliated with your bank or credit card, or one that accepts your credit card, to avoid additional fees. Again, this information is generally available online.
6. Insert your card and select withdrawal
When asked if you want to make a check, savings or loan withdrawal, choose “credit”.
7. Keep your receipt
Remember to keep track of how you will refund the money to your credit card company. Remember, this money comes with high interest, so the sooner you can pay it off the better.