Credit card cash advances: fees and APR
A credit card cash advance lets you withdraw cash against your card's credit line. You pay a fee of about 3% to 5%, and interest at a higher cash advance APR starts the same day. It is costly for a card and still far cheaper than a payday loan.
The short version
- The fee is usually 3% to 5% of the amount, with a $10 minimum.
- The cash advance APR is higher than the purchase APR and has no grace period.
- Your cash advance limit is lower than your credit limit.
- $300 for a month costs about $20, compared with $90 for a renewed payday loan.
On this page
How it works
You can take a cash advance at an ATM with your card’s PIN, at a bank teller, or with a convenience check from the issuer. The amount is added to your card balance under separate terms from purchases.
What it costs
| Cost | Typical amount |
|---|---|
| Cash advance fee | 3% to 5% of the amount, minimum about $10 |
| Cash advance APR | Often 25% to 30%, higher than for purchases |
| Grace period | None; interest starts on the day of the advance |
| ATM operator fee | $2 to $5, if you use another bank’s machine |
On a $300 advance repaid after 30 days: a 5% fee is $15, and a month of interest at 29% APR is about $7, for a total near $22.
Cash advance APR, explained
The cash advance APR is the yearly interest rate applied to cash you withdraw. It appears on your statement and in the card agreement, separately from the purchase APR. Because there is no grace period, even an advance repaid within days costs some interest.
Limits and fine print
- Cash advance limit. Usually a fraction of your total credit line; check your statement.
- Payment order. Payments above the minimum must go to the highest-rate balance first, but the minimum payment may be applied to lower-rate balances.
- Transactions treated as cash. Money orders, wire transfers, some person-to-person payments and gambling charges are often billed as cash advances.
Compared with other fast cash
| Option | Cost of $300 for 30 days |
|---|---|
| Credit union payday alternative loan (28% APR) | About $7 |
| Credit card cash advance | About $22 |
| Payday loan renewed once ($15 per $100) | $90 |
Paying an advance off quickly
Interest keeps running until the advance itself is repaid, so pay it down as soon as you can instead of waiting for the statement. Pay more than the minimum: the amount above the minimum must go to the balance with the highest rate, which is usually the cash advance. How the minimum itself is applied depends on your issuer. Avoid taking a new advance while one is outstanding, since each one adds another fee.
Cheaper ways to use the same card
Paying the bill directly with the card avoids the cash advance fee and uses the lower purchase APR. Some issuers also let you convert part of your credit line into a fixed-payment loan at a lower rate.
Related: cash advance, ways to borrow money and payday loan alternatives.
Common questions
What is a cash advance fee?
A one-time charge for withdrawing cash on a credit card, typically 3% to 5% of the amount with a minimum of about $10.
Does a cash advance hurt your credit?
It is not reported as a separate item, but it raises your card balance and utilization, which can lower your score until it is repaid.
How can I avoid cash advance fees?
Pay the bill with the card as a purchase where possible, or use a debit card. Check which transactions your issuer treats as cash.
Does Northlight lend money?
No. Northlight is an information site. We explain costs and state rules; we do not make loans or credit decisions.
Check the rules where you live
Whether you can borrow, how much, and what a lender may charge all depend on your state.
Sources
Keep reading
- How payday loans workA step-by-step look at payday loans: applying, the fee, the due date, rollovers and what happens if you cannot repay on time.
- Can payday lenders sue you?Yes, a payday lender can sue over an unpaid loan, but it needs a court judgment to garnish wages. Learn the process, the limits and your defenses.
- How to borrow money fastA practical order of operations for borrowing money quickly: what to try in the first hour, the first day and the first week, with typical costs.
- Are payday loans legal?Payday loans are legal in 29 states, capped at 36% to 50% APR in 10 and not allowed in 11 states plus D.C. See which group your state is in.
- Payday loan APR explainedWhy a $15 fee equals a 391% APR, how to calculate the APR on any payday loan, and what fees can be added on top of the finance charge.
- If you can't repayMissed a payday loan payment? Here is what lenders can and cannot do: fees, bank debits, collections, lawsuits, and how to stop the damage.