You may require cash in hand at any moment in your life. Most of the people pose a credit card in the age of globalization in place of hard cash so that they can use the pre approved loan amount as and when they need it. The quick cash advance is a kind of service that is offered by the credit card agencies so that the cardholders can withdraw hard cash from any ATM. They can also use these cards to buy things using them as debit cards of your bank account. The amounts that you can withdraw by the cards have a certain limit up to which you can draw from the ATMs. Though you can access this service for your instant help, this may incur you a higher rate of interest as you withdraw cash through credit cards.
Facilities of Cash Advance
Some people don’t care about the prices while they are on for shopping. They just take the things they like and in the end, they pay. But in most of the cases, these people use credit cards to pay at the billing counter. These transactions are considered as cash transactions and from the customer’s point of view, these are considered as withdrawing cash. Generally when you keep a credit card, then you have to pay a certain charge for that irrespective of your transactions. But while you use the credit card to do such transactions then you have to pay a higher rate of interest and you don’t get any grace period. The interest is calculated from the next day you use the cash.
Charges Associated with Quick Cash Advance
- Annual Percentage Rate
Though you get instant access to the cash for your immediate needs, here you have to pay lots of taxes and charges to maintain a credit card so that you can use them like this. First comes the Annual percentage rate which is an interest rate calculated for the year and it doesn’t consider the monthly rate which applies to the simple loans, or credit cards or mortgage loans. The APR is the financial charge that is charged on the amount that you withdraw through the card.
- Effective Interest Rate
It is the interest rate that is taken on a loan as an equivalent amount of the compounded interest that had to be paid throughout the year. This Effective interest rate is a tool to compare the amount of compounding interest for different periods. Through EIR the periodic rate of interest is calculated for the whole year using the formula of compounding interest.
What is Credit Card Debt?
In general, a credit card debt is considered as the amount of money a person is using to buy a product or service using the credit card. As much as the person buys through the credit card, the debt increases and it gets accumulated along with the interests and the penalties for keeping credit for a long time. The delay in payments will not only result in an increase of the payable amount to the agencies, but it will also put its effect on the credit rating of the person as the agencies report the late payment to the credit rating agencies. Not only may this, being late in paying back the amounts notify you as a defaulter in terms of the banking system rules and legal actions that may be taken.
Relieving Debts of Credit Cards
If someone ishelpless to pay the accumulated debts then he can request the agencies to reduce the APR. There are other ways too to settle debts like ‘Debt Settlement’, ‘Debt Consolidation’, and ‘Debt Counseling’.