Are You Being Charged A Cash Advance Rate For a Credit Card Purchase?
Don't Get Stuck Paying Cash Advance Interest Rates on Your Credit Card
If you look at the terms and conditions of your credit card, you'll likely see that cash advances carry a much higher interest rate than purchases as well as a cash advance fee. However, a cash advance isn't just going to the bank and requesting cash or putting your credit card in an ATM machine. Other transactions qualify as cash advances too -- at least where interest rates are concerned. If you don't want any unpleasant surprises on your credit card statement, these are some things to keep in mind...
Casino and Gaming Sites
If you use your credit card to fund your online game accounts, it may be considered a cash advance by your bank. Because of this, you'll be paying a cash advance fee when the bill comes in and the cash advance interest rate. My advice? Stay away from online gaming sites altogether, but if that's not an option, fund your account with a bank account, not a credit card.
Online Bank Accounts
The other day I was looking at opening an online bank account and I noticed that you could fund the new account with a credit card. Sounds great at first, but what many consumers won't realize is that the credit card company is going to charge them as if the transaction were a cash advance. That means a higher interest rate in addition to a cash advance fee. My advice? Fund all new bank accounts with existing bank accounts -- not your credit card.
Paypal Funding
If you have a Paypal account and you try to fund that account with a credit card, you may be in for a surprise when the statement comes in. Now understand, most credit card companies will not charge a cash advance fee for making Paypal purchases, but some do charge for making Quasi payments and direct funding via Paypal.
Play it safe -- if you ever plan on using your credit card for anything other than a direct purchase, contact your credit card company and make sure it doesn't qualify as a cash advance.