Scotiabank Credit Cardholder Agreement
If you use a cash credit card advance, borrow money from the bank or your card issuer (in addition to every money you already owe on your card for regular purchases and other credits you have). You may also be affected by other minor payment fees, z.B. if you use an ATM that is not linked to your bank or card issuer, or if you receive a cash advance outside the country. Fees and structures vary from financial institution to financial institution, so read the terms and conditions of your card contract or contact your card issuer`s customer team. If you receive a cash credit card payment, it is best not to use a typical premium credit card, but a low-interest credit card with a low cash advance. While most premium cards charge more than 24.99% on cash advances, some of the best low-interest credit cards in Canada charge significantly lower prices. Cash advances can also have a negative impact on your credit score by increasing the amount of money you borrow relative to your total credit limit, also known as your credit utilization rates. In general, you only want to borrow 30% of your total limit to get a good credit score, which can be a more difficult goal if you suddenly withdraw a big credit card cash advance. For most credit cards, you pay an annual (purchase) interest rate of 19.99% on each balance you don`t pay in full. In comparison, the annual interest rate on cash advances can be more than 22.9% and, in some cases, 24.99%. This difference of three to five points can add, especially if you need a long time to repay your cash advance. Not to mention that the interest rate you pay for your cash advance can be increased if you regularly miss payments or if you have an account in poor condition (although you can negotiate these terms with your card issuer`s customer service team).
Depending on the specific credit card you keep with you, you may even have to go through a separate credit authorization process to be considered solvent for a cash advance. You should review the details of your cardholder contract or speak to a representative of your bank to clarify the rules of your card. Below, we provide five facts about credit card cash advances and why they should be avoided. In addition to interest payments, cash advances by credit card often include additional advance fees. These cash advance fees are either calculated as a lump sum or calculated as a percentage of the money withdrawn (and are often accompanied by conditions that require that a minimum or maximum amount may be charged to you).