Three ways to get cash using your credit card
You can get cash from a credit card in three ways: a cash advance at an ATM, a balance transfer check, or a cash-like purchase at certain merchants. Each one costs you differently and affects your credit in different ways, so the cheapest option depends on what you need the money for and how quickly you can pay it back.
The most common method is a cash advance — you use your card at an ATM or bank teller window to withdraw cash directly. The second is a balance transfer check — your card issuer mails you a check that you deposit into your bank account, and the amount owed appears on your credit card bill. The third is a cash-like purchase — you buy something easily converted to cash, like a money order or gift card, though this is rarely the cheapest route.
Before you choose, understand that getting cash this way is not the same as making a regular purchase. The fees are higher, the interest rate is usually higher, and interest starts accruing immediately — there is no grace period like there is for regular purchases.
Key Takeaways
- Cash advances charge an upfront fee (usually 3 to 5 percent of the amount withdrawn) plus a higher interest rate than regular purchases, with interest starting immediately.
- Balance transfer checks often have a lower fee than cash advances but may have a lower credit limit than your card's regular limit, and interest still starts right away.
- Interest on cash advances and balance transfers does not have a grace period — you pay interest from day one, even if you pay the full balance when your statement arrives.
- The money you withdraw counts against your credit limit, and the balance appears on your credit report as a cash advance or balance transfer, not as a regular purchase.
Cash advances at ATMs and bank tellers
A cash advance is the fastest way to get cash. You go to an ATM that accepts your card, enter your PIN, and withdraw money just like you would from a checking account. You can also walk into a bank branch and ask a teller for a cash advance, though this is less common now.
The cost is immediate and steep. Most card issuers charge a cash advance fee of 3 to 5 percent of the amount you withdraw — so a $500 cash advance costs $15 to $25 right away. On top of that, the interest rate on cash advances is usually 2 to 3 percentage points higher than your regular purchase APR. If your card's regular APR is 18 percent, your cash advance APR might be 21 or 22 percent. Interest starts accruing the day you withdraw the money, with no grace period.
There is also a limit on how much you can withdraw. Your card issuer sets a cash advance limit that is often lower than your regular credit limit — sometimes 20 to 50 percent of your total limit. If your credit limit is $5,000, your cash advance limit might be $1,000. You can call your card issuer to ask what your cash advance limit is before you go to the ATM.
Balance transfer checks
Balance transfer checks are mailed to you by your card issuer and work like a regular check — you deposit it into your bank account and the money appears there within a few business days. The amount you deposit shows up on your credit card bill as a balance transfer, not as a purchase.
The fee is often lower than a cash advance fee — typically 1 to 3 percent instead of 3 to 5 percent. However, the interest rate is usually the same as a cash advance rate, not your regular purchase rate, and interest starts immediately with no grace period. Some card issuers offer a promotional period on balance transfers (for example, 0 percent APR for 6 months), but this promotion usually does not apply to balance transfer checks — it applies only to balance transfers from other cards.
Balance transfer checks also come with a separate limit. Your issuer might allow you to transfer $3,000 on a balance transfer check even if your cash advance limit is only $1,000. Check the offer letter that came with the checks, or call your issuer to confirm the limit before you deposit a check.
Why cash advances cost more than regular purchases
Card issuers treat cash advances differently because they are riskier for the lender. When you make a regular purchase, the merchant guarantees the transaction and handles fraud disputes. When you withdraw cash, there is no merchant, no may provide, and no way to reverse the transaction if you claim fraud. The card issuer absorbs that risk, so they charge more.
The lack of a grace period is the biggest cost difference. Regular purchases have a grace period — usually 21 to 25 days — during which you can pay the full balance without paying any interest. Cash advances have no grace period. Interest starts on day one, even if you pay the full amount when your statement arrives. If you carry a $500 cash advance for 30 days at 21 percent APR, you will owe about $8.75 in interest alone, plus the 3 to 5 percent upfront fee.
How cash advances affect your credit score
A cash advance does not hurt your credit score directly — it is not a missed payment or a default. However, it can hurt your score indirectly by raising your credit utilization ratio. Your utilization ratio is the amount of credit you are using divided by your total credit limit. If you have a $5,000 limit and a $1,000 cash advance, your utilization jumps to 20 percent. Credit scoring models treat high utilization as a sign of financial stress, so your score may drop a few points.
The effect is temporary. Once you pay off the cash advance, your utilization drops and your score recovers. But if you carry the balance for months, the damage to your score can last as long as the balance does.
Cash advances also appear separately on your credit report. Lenders can see that you took a cash advance, not just that you have a balance. Some lenders view cash advances as a warning sign — they suggest you are short on cash and turning to expensive borrowing. This is not a formal rule, but it can matter if you are applying for a mortgage or other loan soon.
When a cash advance makes sense
A cash advance is expensive, so it only makes sense in specific situations. The best case is when you need cash for a true emergency and you can pay it back within a few days or weeks. If you withdraw $500 and pay it back within a week, the interest cost is minimal — maybe $2 to $3 — and the upfront fee is the main cost.
A cash advance also makes sense if you have no other option. If you have no savings, no access to a personal loan, and no one to borrow from, a cash advance is better than missing a bill payment or going without necessities. The cost is high, but missing a payment costs far more in damage to your credit.
A cash advance does not make sense if you are going to carry the balance for months. If you need $500 and cannot pay it back for three months, you will pay roughly $26 in fees plus $26 in interest — $52 total on a $500 advance. A personal loan or a 0 percent balance transfer card would be much cheaper. If you have time to plan, explore those options first.
Alternatives to cash advances
Before you take a cash advance, consider whether you actually need cash or whether you need to pay for something. If you need to pay a bill, you might be able to use your credit card directly instead of withdrawing cash. Many utilities, insurance companies, and government agencies accept credit card payments online or by phone.
If you genuinely need cash, a personal loan from a bank or credit union is usually cheaper than a cash advance. Personal loans have lower interest rates (often 6 to 36 percent depending on your credit) and no upfront fees. The downside is that approval takes a few days, so this only works if you are not in a rush.
A 0 percent balance transfer card is another option if you have time to apply. Some cards offer 0 percent APR on balance transfers for 6 to 21 months, with a balance transfer fee of 1 to 3 percent. You can transfer a balance from another card or take a balance transfer check. This only works if you have decent credit and can wait a week or two for approval.
Frequently Asked Questions
Can I use my credit card to withdraw cash at any ATM?
Not every ATM accepts credit cards. Most ATMs that accept credit cards are at banks and credit unions. Convenience store ATMs and independent ATMs usually only accept debit cards. Your card issuer's website or app should show you which ATMs accept your card, or you can call customer service to find one near you.
What is the difference between a cash advance and a balance transfer?
A cash advance gives you physical cash at an ATM or teller window. A balance transfer gives you a check or moves money between accounts. Both charge fees and high interest rates with no grace period, but balance transfer fees are often lower. Balance transfers also sometimes come with promotional 0 percent APR offers, though these rarely apply to balance transfer checks.
Do I have to pay back a cash advance right away?
No, but interest starts immediately and compounds daily. You can carry the balance as long as you want, but the longer you carry it, the more interest you pay. If you cannot pay it back within a few weeks, a personal loan or balance transfer card will almost always be cheaper.
Will a cash advance show up on my credit report?
Yes. Cash advances appear separately from regular purchases on your credit report. They do not hurt your score directly, but they raise your utilization ratio and may signal financial stress to lenders reviewing your application for a mortgage or other loan.
Can I get a cash advance if I have bad credit?
Yes. If you have a credit card, you can take a cash advance on it regardless of your credit score. Your cash advance limit is set by your card issuer and does not change based on your credit. However, the interest rate and fees are the same for everyone with that card, so bad credit does not make a cash advance more expensive — but it does mean you probably have fewer alternatives.