Long Term Cash Advance Loans - Not The Best Option For Credit Starved Borrowers

Long term cash advance loans are traditionally offered only as secured loans. The borrowers are often required to offer collateral security in the form of home equity, or other liquid assets which can be claimed by the lender if a default occurs. As opposed to the short term loans like pay day loans, borrowers would also be expected to be enjoying credit score above the threshold level of 680.

A major advantage with secured long term advances of cash is that the borrowers can expect a significantly lower interest rate compared to unsecured short term loans. In most situations the banks with which borrowers have an ongoing relationship are the best source to apply for and obtain these loans. The relationship that is already existing will be immensely helpful because the banker has a proximate understanding of your personal circumstances and can easily approve the long term cash advance loans in relation to your needs and your ability to repay the loan on agreed terms. Other commercial lenders or the online lenders are less likely to have a broader picture of your individual circumstances and this can impact their response level to your request for long term cash advance loans.

Let us now turn to another situation where borrowers with less than stellar credit scores are looking for long term cash advance loans. Given the fact that respectable credit scores play a vital role in the borrower's ability to get approved, the thought of long term cash advance loans for sub prime borrowers is in itself a tall order. Cash advance loans for sub prime borrowers are generally of short tenure not exceeding 14 days. But, in some situations, a borrower cannot pay off the cash advance within this period and seeks a roll over at an additional cost. While multiple roll overs could have been an option, most states across the United States of America have usury laws in place restricting the number of roll overs that can be granted against an original cash advance. Assuming that a particular lender is willing to short circuit the law also, the cumulative cost of the long term cash advance loans for the credit starved community can exceed the principal amount by several times.

Most of the cash advance loans offered by online lenders are targeted at sub prime borrowers often looking for a few hundred dollars. Because of the high cost of these loans, it can never be a prudent measure to force a long term into what is originally intended to be a short term loan. Some lenders are indeed willing to make merry at the cost of the hapless borrowers but it is for the individual concerned to realize that more viable and perhaps sensible options are available even to sub primer borrowers to wriggle out of challenging personal finance issues. Long term bad credit personal loans for instance qualifies as a far more affordable option compared to the long term cash advance loans. The number of lenders offering long term bad credit personal loans may be fewer but they do exist in the physical world as well as the digital universe.

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