Financial struggles can indeed arise unexpectedly, and when your next payment is a bit too far away to cover urgent expenses, securing a guaranteed cash advance can seem like a quick solution. However, obtaining one isn’t always as easy as it sounds, since approval depends on various factors. Here’s a helpful guide with the best tips to increase your chances of getting a cash advance when you need it most:
What is a Cash Advance?
Before seeking a cash advance, it’s essential to understand how it works. A cash advance is essentially borrowing against your future paycheck, earnings or a line of credit (like a credit card). You typically pay a high interest rate for the service, which can make it expensive if not repaid quickly. In short, a cash advance is a quick capital infusion provided by either your credit card issuer or a funding company as a quick way to obtain funds. Think of it as using your credit card or invoices to buy cash rather than goods or services.
Suppose you need money for a health emergency and the bill amounts to $1000, but you don’t have it in the checking account. That’s when you could withdraw this amount through your credit card by using a cash advance and clear the bills.
The best thing about cash advance funders like Fundo is that your application is processed immediately and there’s no heavy documentation involved. If you go to Fundo, having a minimum of $1500 monthly income is the main requirement. Besides that, you’ll have to show 3 months’ work experience. Such simplicity is the reason cash advances are your savior in times of urgency.
Tips for Securing Guaranteed Cash Advances
A sudden car repair or an unplanned medical bill can throw your finances into disarray. When savings aren’t enough to cover these costs, turning to cash advances is a quick relief. According to The Department of Financial Protection and Innovation, around 2 million Americans take payday loans each year for urgent expenses.
But when you’re in such a tight situation, the fear of rejection adds extra stress to an already difficult situation. If you’re concerned about securing a cash advance when you need it most, here are some tips to help you out:
Provide Accurate and Complete Information
Your chances of getting a guaranteed cash advance are brighter when you provide accurate and complete information on your application. We can’t stress enough how important it is to double-check every detail you enter and be honest while you’re filling in the form.
Therefore, make sure your full name matches what’s on your government-issued ID, including any middle names or initials. Then verify your current address, phone number, and email address so the funding authority can easily reach you if needed.
Discrepancies or errors in your funding application can cause delays or even result in it being rejected. For example, if you’ve recently moved and haven’t updated your address, the funder will struggle to verify your residency, and it will complicate the approval process. So thoroughly review your application and show attention to detail and responsibility.
No lender trusts someone with an inconsistent income and employment history. So, when you seek a guaranteed cash advance, showing stable income, no matter how small, is mandatory.
You can prove your income with recent pay stubs, employment letters, or bank statements showing regular deposits. Some funders will also verify your income via a bank connection, such as through Plaid or another reputable, platform, to confirm a regular direct deposit. If you’re employed full-time, include your most recent pay slips to confirm your earnings and job stability if asked.
But if you’re self-employed or freelance, detailed bank statements or tax returns can serve as proof of income. For instance, if you’re a freelance photographer with steady bookings, compiling a record of invoices and corresponding payments over the past several months can reassure the funder of your financial reliability.
If you have multiple income streams, like a part-time job or rental income, document these as well because they’ll increase your prospects of getting a cash advance.
Don’t Fill Multiple Applications
We get it that financial frustration can force you to make some hasty decisions like applying for multiple loans at once, but that doesn’t help.
While not all funders check credit, applications you put in at a cash advance platforms may result in a hard inquiry on your credit report, which can lower your score temporarily. Also, funders can interpret multiple inquiries as a sign that you’re in financial distress or overextending yourself.
Instead, we recommend researching and selecting one reputable funder, looking into their terms, interest or factor rates, and customer reviews to make sure they’re a good fit. After that, focus on submitting an error-free application to improve your chances of securing a cash advance.
Reduce Existing Debt
If you keep packing up debt, repaying it gets close to impossible, and no financial institute trusts your financial capability. Most lenders assess your debt-to-income ratio to determine your ability to take on more debt.
And if you have high balances on credit cards or other debts, it will indicate that you’re already financially stretched. But buying down your existing debts, you lower this ratio and make yourself a more attractive candidate.
For example, if you have a credit card balance that’s close to your credit limit, making extra payments to reduce that balance can positively impact your application. Doing so demonstrates financial responsibility and shows that you’re actively managing your debts.
Get a Co-Signer
If you have a limited credit history or your score is low, getting a co-signer for your cash advance application can help. A co-signer is a person with a strong credit score and stable income who agrees to share responsibility for the funding. Having them on board provides the funder with additional assurance that the amount will be repaid.
For instance, if you’re a recent graduate with little credit history, asking a parent or close relative with good credit to cosign can make your application appear worthy.
But before going down this path, have an open conversation with your co-signer about the responsibilities involved. They must understand that if you fail to make payments, they will be held accountable.
Once they agree, having a co-signer will increase your chances of approval and may help you qualify for better terms and lower interest rates. Impressively, making timely payments on a co-signed loan can positively impact both your credit scores – win-win for both parties.
Get a Cash Advance From a Reputable Funding Partner
You could have a strong funding application and financial records to prove your credibility, but if the place you’re borrowing money from isn’t credible, the process won’t go well. So, when you decide to put the SOS sign and ask for financial assistance, make sure you go to a trustworthy place.
A clear applying process and no hefty documentation will help get you out of the financial crunch as soon as possible. And not expecting insane interest rates would mean this cash advance won’t wreck your finances in the long-term.
Cash advance funders like Fundo are built to support circumstances where you’re short of money and need it fast. Fundo makes sure you aren’t put on a long waiting list nor are there crazy requirements for an approval. So don’t let a tough phase get the best out of you, reach out to Fundo and let’s solve this problem together.
FAQs
How does a cash advance affect my credit score?
When you take a cash advance, the transaction may trigger a hard inquiry as lenders assess your creditworthiness, which may lower your score for some time. Also, since cash advances carry high-interest rates and fees, they increase the likelihood of carrying a balance and accruing interest, which then adds to your credit utilization ratio. A higher utilization ratio, especially one that exceeds 30% of your credit limits, can negatively impact your score.
Are there alternatives to cash advances?
Yes, personal loans, borrowing from friends or family, and payday alternative loans from credit unions are a few substitutes of cash advances. Plus, some credit cards offer 0% introductory APR on new purchases for a limited time, which you can use to manage immediate expenses.
Can I get a cash advance with bad credit?
Getting a cash advance with bad credit is possible as many cash advance lenders focus less on your credit score and more on your current income and ability to repay. But you must review the terms of the advance carefully, as lenders typically compensate for the increased risk by charging higher fees.
Disclaimer:
Fundo offers Revenue Based Financing programs exclusively for business use. Any references to loan products, consumer products, or other financing forms are solely for marketing and educational purposes, aiming to differentiate Fundo's product from other similar financing options in the market.
