Getting a cash advance from a Barclaycard. Bad idea?

ensignia

Hello all, I was registered on here since 2005 but have forgotten my login details, so not a complete newbie! Basically, I'm wanting to get a £1500 cash advance from my Barclaycard and was wondering how the interest would work.

I have a current total balance of £1800 and £4650 available credit. I very rarely use this account and it'll be paid off in full shortly, but once I take out £1500 the total balance will be £3300. I will be able to pay £1500 back within a week or two so it won't kill me on interest. My cash annual rate is 27.9%, would it be financial suicide to take out £1500 from my Barclaycard even if I pay it back quickly?

I'm aware that interest starts accruing from day one, and that there may be a withdrawal fee. Interest I pay on the cash balance is currently at £4.48, so I'm very wary of taking out £1500 and paying through the nose until I clear the balance.

I know there are better ways to get cash, but I need it pretty damn quickly and this is the only one I can where I can get the money instantly. Any advice would be much appreciated. :beer:

rodenal

Sounds like you know what it's going to cost and so long as you really can pay it back within a few weeks it certainly wont kill you on interest. The only other thing I would suggest is perhaps an overdraft from your bank? Even at a pound a day for a few days it may compare favourably.

guesswho2000

In any event, how do you propose to draw this cash out? I would imagine you'll have a daily cash withdrawal limit, and your cash limit may well be substantially lower than your overall credit limit. The cash withdrawal fee would be in the region of £45 straight away on top of the interest incurred...I'd use this as an absolute last resort when it comes to obtaining cash tbh.

dazla

ensignia wrote: »

Hello all, I was registered on here since 2005 but have forgotten my login details, so not a complete newbie! Basically, I'm wanting to get a £1500 cash advance from my Barclaycard and was wondering how the interest would work.

I have a current total balance of £1800 and £4650 available credit. I very rarely use this account and it'll be paid off in full shortly, but once I take out £1500 the total balance will be £3300. I will be able to pay £1500 back within a week or two so it won't kill me on interest. My cash annual rate is 27.9%, would it be financial suicide to take out £1500 from my Barclaycard even if I pay it back quickly?

I'm aware that interest starts accruing from day one, and that there may be a withdrawal fee. Interest I pay on the cash balance is currently at £4.48, so I'm very wary of taking out £1500 and paying through the nose until I clear the balance.

I know there are better ways to get cash, but I need it pretty damn quickly and this is the only one I can where I can get the money instantly. Any advice would be much appreciated. :beer:

They will probably cut down your cash limit once you start withdrawing on it, as your daily limit for withdrawals is about £200 a day, after you ahve withdrawn a few times, they may well reduce your cash limit . This is what happened to me

[Deleted User]

You'll also present yourself asa higher risk to the lender. So more likely to get a rate increase in future.

notafan

Deleted_User wrote: »

You'll also present yourself asa higher risk to the lender. So more likely to get a rate increase in future.

Barclaycard set your cash limit and you can see it online - i imagine they'll be overjoyed at the prospect of someone using a cash advance over using the card.

Fair enough if OP misses payments or is late then they might be reassessed. When they give you the credit limit the risk is factored in - its just a bonus if you use it in ways they can charge maximum interest. A few weeks at that amount and putting it back will have minimal effect if any.

[Deleted User]

Cash users are classed as higher risk. Hence the increased likelihood of repricing.

chanz4

a cash advance will see you as been desperate to other lenders, along also with the stupid apr

notafan

Yer i think longer term if your continually taking out the maximum you can on cash, whilst making minimum payments over the long term then they'll maybe see it as a problem - the same as you max out the card and make minimum payments etc.

I think a couple of weeks and it wont even make a difference. Its not as though someone's sat watching all the accounts waiting to see someone doing a cash advance. The risk is calculated on the amount of credit your offered i.e. the limit you get. The APR on card or cash is a profit tool. Spending £500 on the card or taking the same amount through a cash advance is the same risk to the company - they are exposed to £500 of lending no matter which way it was borrowed.

If it was of that much of a risk card providers wouldn't offer it. They're about making money.

I think there's a big misconception that certain things mean certain things for any company lending out money. There are that many idiosyncrasies it is not possible to say that if you take a type of action on a card that all lenders will see it as bad/good.

Whilst I agree on the whole that continuously missing payments, being late with them, going over credit limits can have a negative impact - i think some credit providers definitely look at that and think its an extra revenue stream - example in charges. The APR everyone's with at that lender is covering bad debt, and you'll get people that run accounts perfectly never miss payments or pay in full etc and they will be unable to get cards (such as the egg in the past although there are a couple of other examples) simply because the company can't make a profit from someone.

chattychappy

Strange.. I wrote a post and it didn't appear... I'll summarise since most of the points have already been mentioned:

1) Daily ATM limit might be a problem
2) Over the counter might also be subject to a limit. They might want extra ID - so have stuff with you
3) Barclaycard sometimes set a limit for cash advance balances which is lower than your overall credit limit. In my case it started off as £5000 out of £10000. The restriction seems to have been removed on my account, but I remember another poster saying he wasn't permitted cash advances at all.
4) The fee on my BC account is 2.5% (plus interest from the day of withdrawal). If you have Santander Zero/Halifax Clarity there is no fee at all.
5) Cash advances usually get noted on CRA reports and could be a sign of distress. BUT, I've frequently used Zero to get cash overseas and don't appear to have had a problem.
6) You may need the cash advance to appear on a statement before you can pay it off - else your payment might be applied to any unpaid, statemented purchases first. (Depends on what else is going on + Barclaycard's T+Cs.)

ensignia

Thanks for the replies so far, all very informative.

I plan on going to the bank and withdrawing over the counter. Do I just go there with my Barclaycard and some ID and ask to withdraw the money?

@chattychappy: Point 6 is something I hadn't thought of. If that were the case I'd be screwed, I don't suppose anyone would have any more information about it would they?

I don't think I've missed a payment for a couple of years, I never go over my credit limit and I've held this account for 6 years so I'm not overly concerned about looking desperate to other lenders as this is the only credit card I'll need. I don't like the sound of the 3% withdrawal fee, but these companies have to make their money somewhere and this is my absolute last resort, due to my bad planning and people being lazy paying me back!