Why Would I Need To Transfer Money From A Credit Card To A Debit Card
Sometimes you might need a small sum of money but you do not want to take out a formal loan. If you want to clear an overdraft or borrow a small sum of cash, you can use a money transfer credit card to move credit into your current account. Bear in mind that you are borrowing money to pay off an existing debt, and this can become a dangerous habit. If you are having problems with your cashflow and need help with your finances you can contact a charity such as StepChange or National Debtline who will give you debt advice for free. Never take on more debt if you cannot afford it or if you have no way of being able to pay it back.
How To Get Money Off Your Gift Card
Here is how to get money off a gift card.
The process is easier than you think. First, you have to check the balance on the card. This is so that you can determine if this is worth it or not.
Next, you are going to want to take your card to a gift card exchange kiosk. Follow the directions on the screen. Check over everything before you hit accept.
Take the receipt to the cashier and get your cash. Its like going to the CoinStar.
Alternatively, to get money from your gift card you can do the following:
- Sell your gift card.
- Use the gift card to buy an in-demand product and then sell the product.
- Buy money orders directly to pay yourself.;
- Trade your gift card for something else. This is similar to selling but you can get a different product for it in exchange.
How Does Credit Card Processing Work
Acquiring banks contract with merchants to operate accounts that allow the merchants to accept credit card payments. Acquiring banks deposit funds for credit card purchases into merchants’ accounts. They also furnish merchants with credit card processing software and equipment such as a merchant processor, credit card reader and terminal, as well as providing customer service, promotional materials and other credit card processing services.
Any merchant who wishes to accept credit card payments must have a merchant processor account. A merchant account is an unsecured line of credit that pays a merchant for customer purchases. The payment is actually a loan to the merchant’s account from that merchant’s acquiring bank. In other words, the acquiring bank loans money to the merchant to cover the cost of customers’ credit card transactions.
After a credit card transaction is complete, the merchant will have less money than the original transaction amount because both the issuing bank and the acquiring bank will charge the merchant fees for their services. These fees include a percentage of each transaction, and the higher the transaction amount, the higher the fee. The merchant may also be charged fixed fees for each transaction by the issuing bank and the acquiring bank.
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Purchase A Prepaid Gift Card
Buy a prepaid gift card with your credit card and then sell it to someone for cash. You may have to accept a little less than the face value of the card to incentivize someone to purchase it from you, but there are several online marketplaces to assist you: Cardpool, Giftcard Granny, and Raise, to name a few. Just make sure whatever discount you offer is less than what you would have paid in cash advance fees and interest.
If you have accumulated credit card rewards, you may be able to redeem them for a gift card, sometimes even for more than face value. For example, you may be able to get a $25 gift card for rewards worth $20.
Deposit Cash Into Your Checking Account
Probably the most convenient way to get a cash advance from Bank of America is to transfer funds directly into your checking account. Head over to your online account to request a cash advance. The deposit normally takes up to three business days.
Alternatively, for an extra fee, you can use the same-day transfer option to send money to your Bank of America checking account.
Note, however, that not all cardholders are eligible to use the deposit feature. If you try to request a cash advance this way and get a message that the transaction cant be completed, the issuer suggests calling in to discuss your options.
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How To Take Out A Cash Advance
Withdrawing money from an ATM using a credit card is a simple process. Its like withdrawing money from an ATM using a debit card with only a few slight differences.
Why Use A Cash Advance
Even though there are a lot of costs and high interest rates associated with a credit card cash advance, you may still want to consider one in certain situations.
If youre traveling in a foreign country and you havent notified your bank of your travels, you could end up stranded without access to local currency. If it suspects fraudulent activity, your bank may put a hold on your checking or savings account, leaving you disconnected from your cash. Usually, you can clear this up with a simple phone call, but you might not have access to cell service or international calling, or you may have trouble connecting with a bank representative because of a time difference. As long as your credit card hasnt also been blocked, you could use it to take out a cash advance in a pinch.
You may also decide on a cash advance in other cash-only situations, say, if youre short on rent and your landlord doesnt accept credit cards, or if you find yourself in an;emergency situation;that requires cash immediately.
But in all of these scenarios, if you have the option to use a;debit card;to pull out cash directly from your;bank account, we recommend doing that over a;cash advance.
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How A Cash Advance Works
If you carry only credit cards for day-to-day spending, you could find yourself in a pinch when confronted with a cash-only situation, such as buying lunch from a street vendor, veggies at a farmers market or a sandwich at a mom-and-pop deli. In that case, a cash advance;might be tempting. Some;people also turn to credit card cash advances when they need paper money but don’t have enough in their bank account.
If your credit card has a PIN, you can get cash advances directly from an ATM. Otherwise, you can take your card to a bank that offers advances through your card’s payment network, such as Mastercard or Visa. You’ll have to show ID.
Be aware;that most credit card companies wont allow you to take;your entire credit line in the form of a cash advance. For most people, cash advances are capped at a few hundred dollars. This means that you cant rely on your credit card to provide you with very much cash in the event of an emergency.
» MORE:Are credit card cash advances a good idea?
How Does Credit Card Interest Work With A Cash Advance
As noted above, the interest charges on a cash advance are different from those on a purchase. Not only is the rate generally higher for a cash advance, but there is no grace period, which means that interest starts to accrue from the date of the transaction. And you will pay interest on your cash advance even if you pay it off in full and had a zero balance for that billing cycle.
You also have the option of paying off the cash advance over time, just as you can with a purchase, as long as you make minimum monthly payments.
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Will My Credit Card Work In An Atm
Nearly every credit card allows you to borrow cash with cash advances, however it is probably not a good idea. After all, fees and high interest rates are a great way for issuers to make money, as you can see in this example.
Check the cardholder agreement that came with your card to make sure. If you see a Cash Advance APR and;Cash Advances Fee, then you can probably get;a cash advance with that card. It might look something like this:
Check your credit card statement. If you see a cash advance credit line or;cash advance credit limit, thats the;maximum amount of cash you can take out. Its important to know;what this is so you dont try to withdraw too much.;The credit limit for cash advances is usually smaller than your cards credit limit for regular purchases.
If you dont have your credit card terms or a statement handy, you can;call the phone number on the back of your card to ask if your account allows cash advances and the limit of your cash advance line of credit.
Otherwise, provided you have enough available credit, the only thing that would prevent you from being able to access a cash advance on the fly is if you didnt know your credit card PIN.
You may have received a PIN when you initially received your new credit card in the mail, or you may have had the option to create your own custom PIN online or by phone.
Alternatively, you can always call the customer support phone number on the back of your credit card for assistance.
Insider tip
What Drawbacks Of A Cash Advance Should You Consider
There are three major drawbacks to a cash advance. First, your bank will charge you a cash advance fee every time you use a credit card at the ATM. Since ATM fees are already higher than ever, paying an additional cash advance fee on your ATM transaction is an extra expense that you should try to avoid whenever possible.
Cash advance interest rates can be much higher than the interest rate your credit card issuer charges for purchases and since cash advances dont come with grace periods, that interest starts accruing right away. Interest charges on a cash advance can seriously add to your debt, especially if you carry a balance on your credit card from month to month.
The third drawback of a cash advance has to do with your credit score. Taking out a cash advance will lower your available credit, so be prepared for your credit score to go down. You can also expect lenders to view you as more of a , since people generally only request cash advances when they dont have enough money in their checking account to cover an expense that requires cash.
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What You Need To Know About Credit Card Processing:
If you want to set up a merchant account for credit card processing, you probably wonder about the credit card fees you will be charged. The most important determinant of how high your fees will be is the type of business you are in. Certain businesses are more likely than others to suffer payment disputes and chargebacks, so their transactions are considered riskier by issuing and acquiring banks. Businesses with these riskier transactions are therefore charged higher fees to offset the risk of chargebacks.
Chargebacks are what happens when a customer successfully disputes a credit card fees transaction with your business. The safest transactions, as far as the issuing and acquiring banks are concerned, take place when the cardholder swipes his or her own card in the credit card reader and signs the receipt to pay for goods that are inexpensive and not likely to generate complaints. Restaurants, gas stations and car rental agencies all fall into this category, and because their chargeback risk is low, they pay less in fees for credit card processing transactions.
Disadvantages Of Credit Card Cash Advance
Charges and fees:
Each time the cash advance facility would be availed, the fee can be levied that can further lead to extra finance charges. These charges can be charged from the transactions date to the date of repayment till completely.
Rate of interest:
The rate of interest on the cash advance is the same as other card transactions interest charges. But, the interest can be charged from the transactions date till the full repayments that make it even more expensive.
Reward points:
The cash withdrawal method is not eligible for any kind of reward point. It does not matter how big the withdrawing is, and one does not get reward points for cash advance credit cards.
Interest-free duration:
Other parameters that lead to the expensiveness of these credit cash advances is the interest rate. It can be altered from the transactions date to the full repayment date. There is not any interest-free duration, and it would continue until the payment does not fully pay. Therefore, it is necessary to know the interest rate as well as how to get cash from a credit card.
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Use The Visa Gift Card To Pay Your Bills
The next method, which is as good as getting liquid cash, is using the gift card to cover your bills. This can be done with the free service called Plastiq as mentioned above.
You can do this in the following ways:
-
Pay large bills like your mortgage, car payment, and more
Since you would have used cash to pay for the installments of loans like your car loan or mortgage, using the card is as good as cash.
Some companies, such as Plastiq, allow clients to settle certain bills through credit cards.
And, since Visa cards are perceived as credit cards, you can use them with companies that allow payment by credit.
However, you should know that since the company will treat the card as a credit card, the card will incur slightly fees. Its completely free to sign up and try.
Free
-
Pay everyday bills
Besides using the cards for larger bills, you can also use it to settle regular bills or, better still, make some local purchase with the Visa gift card.
This is possible since, in most cases, Visa gift cards are acceptable in stores that accept normal Visa cards.
Also, billers who accept the use of credit cards will, in most instances, take the gift card as payment.
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What Are The Alternatives To A Money Transfer Credit Card
If you need a larger loan, say £10,000, for a project like home improvement, then you might be better off with a personal loan.
If you are looking to borrow a large amount at a lower interest rate,;you might consider a secured loan. This is a loan that is secured against the value of your house.
The other alternative to a money transfer credit card is an overdraft with a current account.
Some of these also have an interest-free buffer and don’t require a minimum monthly repayment. The interest-free portion of an overdraft is usually not as generous as the credit limits for money transfer credit cards.
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What Happens When The Interest
It is best to pay off the amount in full before the 0% term ends. That is because the interest rate on the outstanding loan from your credit card could rise to 23%.
If you are using the money transfer credit card to help you pay off a loan or mortgage, make sure you won’t be incurring any early repayment penalties. Many lenders want you to pay off a specific amount of the debt each month. So if you suddenly had a lump sum of cash allowing you to pay off a larger proportion, which would clear the debt quicker, just make sure you won’t be charged a penalty fee.
To avoid paying interest, don’t spend on your new money transfer credit card, unless it also offers a 0% interest purchase period, or you’re sure you can repay your spending in full each month.
What Is Credit Card Cash Advance Fee
Typically banks charge 2.5% to 3% of the withdrawn amount subject to a minimum amount of Rs.300 to Rs.500 as credit card cash advance fee. The fee will reflect in the coming months billing statement. Cash advance fee also attracts a finance charge at a rate similar to that charged on the withdrawn amount. It will be levied from the date of withdrawal till the amount is paid back in full.
Even when you conduct multiple cash advance transactions on a given day, you will be charged for every transaction based on the withdrawal amount.
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Is All This Worth The Trouble
If you pay it back in a month, a $1,000 credit card cash advance will typically cost 5% upfront and 2% interest for the month . Thats a total cost of $71, and some of the strategies above may only cut that cost in half. So is it worth it?
You can decide that based on your own situation.;
If you cant pay back that cash advance quickly, these strategies become more valuable. Youll typically be paying an interest rate thats 6% less than the normal cash advance rate. That saves you money every month.;
Steve Gillman is the author of 101 Weird Ways to Make Money and creator of EveryWayToMakeMoney.com. Hes been a repo-man, walking stick carver, search engine evaluator, house flipper, tram driver, process server, mock juror, and roulette croupier, but of more than 100 ways he has made money, writing is his favorite . Editor Caitlin Constantine contributed to this report.
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