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Cash Advances Loaded with Surprising Fees.

[[para]]Issuers Charge Sizable Upfront Fees, Interest Begins Accruing Immediately[[/para]]

AUSTIN, Texas, June 3, 2015 /PRNewswire/ -- Credit card cash advances are loaded with fees that can cost consumers a surprising amount of money, according to a new report. 98 of the 100 cards that surveyed charge a cash advance fee. The most common fee structure is 5% of each cash advance or $10, whichever is greater.

Plus, cash advances begin charging interest immediately. This is unlike purchases, which have an interest-free grace period based on billing cycles. The average cash advance APR is 24% (much higher than the average purchase APR of 15%).

A typical $1,000 cash advance would cost an additional $69 even if it's paid in full within 30 days ($50 for the typical 5% fee plus $19 in interest). A $1,000 purchase would not accrue any interest if paid within 30 days.

Many people have probably taken a cash advance without knowing it. The paper "convenience checks" that many credit card issuers send customers in the mail are one prominent example. Wire transfers, money orders, legal gambling purchases and bail bonds are also often treated as cash advances if paid via credit card.

Paying off a high-interest cash advance can take even longer if you already carry a balance, due to the way many card issuers allocate payments. As allowed under the federal Credit CARD Act, when multiple balances are present, issuers may allocate the minimum payment to the part of the balance with the lower rate. This allocation method slows the pace at which the high-rate balance is paid off, boosting interest costs.

The highest cash advance APRs that found were the First Premier Bank credit card (36.00%), the BP Visa and the Texaco Visa (both 29.99%) and the ExxonMobil SmartCard (29.95%).

"Cash advances can be the best of a bunch of really bad options when times get tough," said Matt Schulz,'s senior industry analyst. "They're way cheaper than a payday loan and more convenient than a personal loan. Sometimes they might even be cheaper than overdrafting your checking account. But they're definitely something to avoid under normal circumstances."

More information is available here: surveyed 100 major credit cards (a representative sampling of all major U.S. issuers) in May 2015. Information was gathered from the cards' terms and conditions documents, any publicly available cardholder agreements and phone calls to issuers.

About :, named a "Best Site for Managing Your Credit" by MSN Money, is a leading online credit card marketplace, bringing consumers and credit card issuers together. At its free website, consumers can compare hundreds of credit card offers from America's leading issuers and banks and apply securely, online. is also a destination site for consumers wanting to learn more about credit cards. Offering advice, news, features, statistics and tools, helps consumers make smart choices about credit cards. In 2014, over 22 million unique visitors used to find the right credit card to suit their needs.

For More Information: Ted Rossman Public Relations Director 917-368-8635

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Publication:PR Newswire
Date:Jun 3, 2015
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