Would getting a cash advance online help me build my credit score? The answer to that could be yes and no. It would all depend on what your credit score looks like and in what direction you need your debt to go in.
A cash advance is a no credit bureau check loan.
No hard inquiry into your credit history is a helpful thing. Each time a new creditor looks into your credit to view how you manage your money and what other creditors you owe, your credit score gets knocked down a few points. Hard inquiries will stay as part of your credit history for up to two years. Applying too often can bring your score down and make you look desperate for cash. Right from an application, a cash advance online is already a better option than a new credit card when needing an avenue for fast money.
If you do decide to go the credit card route, your balance amount and spending limit will become part of your credit score. A cash advance is never reported to a credit bureau as long as you continue to make payments. If your loan goes into default and is sold to a collector, the collections agency will report this amount to the credit bureaus. Having your debt reported can cause many problems, especially if your debt to income ratio is high.
What if you have no credit?
There are many people who assume they have good credit because they do not owe any money. Actually, you need to have some payments in order to build a credit history. Your credit score is based on how well you manage these payments. If you have nothing to manage, what is there to report? It’s a bit of a catch-22.
One of the main concerns for creditors is how much of your available balance you spend and don’t pay off. The bureaus would like you to have less than 30% of your debt on file. If you have spent more than 30%, you will want to pay down your balances. Your credit score will go up as your debt goes down.
Did you know that having credit cards which you do not use and carry no balance can also hurt your score? It will also work against you to cancel these accounts. Cancelling credit will hurt your credit score. The best advice out there would be to rotate the cards you have and make small purchases. Pay off the debt to keep interest from eating at your income. Use the cards on items you would normally purchase so there is nothing extra to interfere with your budget.
Your credit score is an important part of everyday life. It sets the tone of new credit and what interest is applied, but it can also keep you from getting any help at all. Take a look at your credit report in order to see what has been reported. Correct errors made by creditors and work to pay down your debt. Apply for a cash advance online to prevent any late fees. It is a cost effective way to help your credit score from further problems.
