A credit card cash advance may be necessary in order to get out of a short-term financial jam. Some people worry that taking advantage of this cash distribution against their credit card limit will negatively affect their credit score.
Even if an individual pays the money before the stated due date, there will be some affect on the credit when the item is reported to the credit bureau.
The credit score can be affected each time the reported balance for a credit card changes. If the credit card company reports the balance and cash advances on a monthly basis, it could make its report before the consumer pays off the advance.
However, if the payments are made on time and in the proper amount, there should be no negative effect on the score.
An individual who exceeds his or her credit limit should immediately return the excess to prevent the credit score from falling. Anyone who takes a large number of cash advances should be careful not to let the credit liability reach more than 30 percent of total available credit.
Doing so could severely affect the credit score. For some people, responsible use of cash advance loans and timely repayment could actually help improve a credit score.
