Using a Cash Advance to Pay Rent or Other Monthly Bills

May 16, 2008 · Filed Under cash advance 

The most common reasons for millions of people a year to apply for a cash advance is to pay rent or other monthly bills. It has become an increasing popular way to obtain money from a future paycheck that you need now. With the cost of living rising faster than cash advance companies you can see where there is a need for this industry. One of the problems with obtaining an advance in your paycheck is the absence of that money later on. Which in turn forces people to apply for another cash advance. This cycle must be avoided whenever possible it can cause heartache for many people living beyond their means.

Every person’s circumstance for needing a cash advance is different it is up to you as the consumer to know what is right for you. A good condition for a cash advance would be Tom’s example.

Tom has been working the same job for years and has a steady reliable income. He missed a couple of days at work last week due to an illness and his employer does not offer sick pay. Tom is a couple hundred dollars short of his mortgage payment, but it must be paid on time or it will affect his credit. Tom knows that he will have a full paycheck the week after, so he does some research into obtaining a cash advance. The cash advance company offers Tom a two hundred dollar loan with an added thirty dollar fee. Tom thinks it is worth thirty dollars to pay his mortgage on time. So he takes the loan knowing he can afford to pay it back.

Now there are times when a cash advance would not be the best solution. For instance read Bill’s example.

Bill is on a fixed income of three hundred dollars a week and many of his monthly bills are behind. Bill struggles every week to scrape up enough money for groceries after his essential bills are paid. Bill inquires about a cash advance because he feels he is in over his head and needs some catch up money. A cash advance company offers Bill a loan of two hundred and fifty dollars against his next paycheck with an added fee of forty dollars. Bill is able to get caught up for that week, but when his loan becomes due it leaves him with a mere sixty dollars, a far worse situation than he was in before the cash advance. Bill is given the option to “extend” his cash advance another week if he pays the forty dollar fee. Bill agrees and the lender adds an additional forty dollars. And Bill stays in the exact same predicament.

It is common for people to use a cash advance loan to pay monthly bills that are due. You should always evaluate your particular position and decide if a cash advance can help you or hurt you. These loans are short term emergency solutions and can not be depended on for daily living expenses. In short, a cash advance won’t pull you out of debt, it will just help you get by for a week.

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One Response to “Using a Cash Advance to Pay Rent or Other Monthly Bills”

  1. save money tips on August 23rd, 2008 10:36 am

    Ouch. Payday loans should probably be your last resort. Personally, I would call your creditors and explain your situation first. They would probably rather get your money in a week or two than have you take out a payday loan. Give it a try.

    save money tipss last blog post..Let your out of town friends call you for free

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