You have heard the stories of people taking out a cash advance only to owe more in finance charges than in principal. You can?t help but ask ? how did this happen? Will it happen to me? You can avoid such situations if you shop wisely for a cash advance company and pay your loan on time.
Rolling Fees
Cash advance lenders charge on average $15 for every $100 borrowed. If you were comparing APR, it would be 390%. Some lenders? APR can be as high as 1000%. This usually occurs when the pay back period is calculated in days rather than weeks.
So a cash advance of $100 will require a payment of $115 on payday. If that loan is rolled over for another two weeks, the loan payment will be $130. Do that for four pay periods, and you will owe $60 in finance charges. View the rest of this article
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