How to Get Cash from Credit Card Without Charges

Last Updated on September 23, 2023

When you’re in urgent need of funds and your bank balance isn’t enough to cover it, you do have choices. One such alternative is obtaining a cash advance through your credit card. It’s simple; you simply use your card at an ATM, much like a debit card. However, due to fees, interest rates, and other issues, it’s advisable to consider cash advances from credit cards as a last-ditch solution. But there are methods to get cash from credit card without charges.

We’ll go over these strategies shortly, but first, let’s examine how cash advances can negatively impact your financial status.

Problems with credit card cash advances

Obtaining a cash advance might seem simple; go to an ATM, input your credit card PIN, and withdraw. However, there are valid reasons why seeking alternatives may be a better choice. It begins with the fees.

Fees

Primarily, most credit cards impose a fee ranging from 3% to 5% for cash advances.¹ Hence, a $1,000 advance would cost you $30 to $50, even if it’s only for a day. Additionally, the ATM transaction for the withdrawal may incur a fee, which can vary from a couple of dollars to even $10 in certain locations.

Interest rates

Then, there’s the issue of higher interest rates. Typically, credit card companies have two types of interest rates: a standard rate for usual purchases, and an elevated rate for cash advances. The difference between these annual percentage rates (APRs) could be as much as 10 percentage points or more in some instances.

No rewards

Meanwhile, unlike regular transactions, cash advances don’t earn rewards because it is seen as cash loan. This is an important factor to consider when withdrawing substantial sums at an ATM using your credit card.

Grace period

Besides high-interest rates, cash advances usually do not include a grace period. Most credit cards apply interest charges to your account only after your payment due date, which means if you clear the entire balance before the due date, no interest is charged. However, for cash advances, interest typically starts accruing from the day of withdrawal.

Credit limit

Lastly, the credit limit for cash advances is often much lower compared to the overall limit of your card.² For instance, a card may have a total credit limit of $4,000, but its cash advance limit might be just $750.

How to get cash from credit card without charges

While taking a cash advance could seem like the simpler route, it comes with notable financial burdens. There are ways to turn your credit card limit into cash without attracting fees, but it requires some strategic thinking and planning. Consider these methods to get cash from credit card without charges:

Buy on behalf of your friends

Is your friend considering a significant cash purchase? If so, you can propose to make the purchase using your credit card and get cash from them instead. This way, you get the required cash without incurring advance or ATM fees.

Additionally, if you have a 0% APR introductory rate card, you can repay that $1,000 slowly without incurring any interest.

This method also offers more advantages:

a. Credit card reward points

If your card offers rewards, these purchases will earn you points. These reward points can be redeemed for free or discounted gifts or statement credits.

b. Additional discounts

If you have a store credit card from the retailer your friend plans to purchase from, you may qualify for a discount. You can pass on these savings to your friend or keep the extra cash.

c. Extended warranty

Some credit cards provide a free extended warranty on high-value items, usually about a year beyond the manufacturer’s warranty.

There are a few drawbacks to this approach. The most obvious is the risk of exceeding your available credit for the transaction. Moreover, this method can significantly increase your credit ratio — the ratio of your card balance to your credit limit — which may negatively impact your credit score.

Cash through prepaid cards

You can get cash from credit card without charges with prepaid cards. The most straightforward method involves purchasing a Mastercard gift card using your credit card, loading it with the desired amount, and withdrawing cash at an ATM.

However, these cards usually lack a PIN for cash access, necessitating you to reach out to the gift card issuer. They might provide the PIN over a call or mail it to you.

After acquiring the PIN, you can proceed to an ATM to withdraw your required cash. Be sure to factor in any applicable fees such as ATM fees, activation fees, and transaction fees to confirm they’re less than your credit card’s cash advance fee.

Keep in mind that not all Mastercard-branded gift cards permit ATM cash withdrawal, so verify the terms before purchase.

Alternatively, purchasing a store gift card from a prominent retailer, like Walmart or Target, using your credit card, and then reselling it online is another viable option. Sites like CardCash and Raise offer platforms for this purpose.

However, be aware that these sites buy your gift cards at a lower rate. You’ll want to ensure the discounted amount is less than potential cash advance fees for the operation to be worthwhile.

Consider a third-party payment services

If you need to tide over till your next paycheck, services like Plastiq could come in handy. They allow you to use a credit card for expenses typically not payable by credit, such as rent and utilities, for a 2.9% service fee. If you manage to clear the bill promptly without incurring your card’s high interest rate, the convenience charge might be worth it. Using a rewards credit card could help offset the upfront fee.

Join retail arbitrage

Retail arbitrage is another method of converting your credit limit into cash. The concept involves buying a discounted item from a retail store and reselling it for profit on platforms like eBay, Amazon, or Facebook Marketplace. If facilitated through a credit card, you could convert your credit limit into cash, along with any additional credit card rewards such as points, cashback, or statement credits.

Although potentially slower, this approach avoids fees except for interest charges and can be profitable.

Low-interest or 0% intro APR credit cards

Certain credit cards offer 0% intro APR periods on purchases allowing you to finance essential purchases without immediate interest charges. Remember that you’re still responsible for the money owed, but you get a significant grace period, often 6 months to nearly 2 years, to repay in full before interest is charged.

For instance, the Wells Fargo Reflect Card offers nearly a two-year interest-free period for purchases and qualifying balance transfers, followed by an ongoing APR of 17.99%-29.99%.³

Leverage credit card loan programs

Some credit card issuers provide loans to existing customers, allowing them to pay off certain purchases over time for a fee. Notable examples include AmEx’s Pay It® and Plan It® features, Citi’s Citi Flex Loan, and Chase’s My Chase Plan and My Chase Loan. These programs enable customers to borrow at lower rates compared to cash advances and allow repayments over time.

Balance transfer checks will help

You can use credit card companies with low or zero-interest offers to transfer balances from other credit cards. Occasionally, these deals include convenience checks that you can write out to anyone, including yourself.

You can write one such check to yourself and deposit it into your bank account, taking advantage of the special APR.

However, these often involve a 3% to 5% fee. Ensure this is less than what you’d pay for a cash advance. For instance, the Citi® Diamond Preferred® Card offers a 0% intro APR for 21 months but includes a standard 5% balance transfer fee. This card doesn’t have an annual fee or a rewards program, which can help you focus on repaying your debt rather than increasing it.

Note that balance transfers can take between two to 21 days to reflect in your account.⁴

Have a friend or family member reimburse you

Should a close friend or family member be planning a large purchase soon, consider offering to pay with your card and ask them to reimburse you in cash. The chances of this aligning with your need for quick cash might be low, but if it does, your friend could be of assistance. This strategy allows you to avoid cash advance fees and immediate interest accrual. Ensure that you can clear your balance before it’s due.

Meanwhile, you can use this method to withdraw money from your PayPal Credit.

Conclusion

While cash advances can provide immediate relief, their associated fees and high interest rates make them a last resort. They’re not only expensive but can negatively impact your credit score and induce unnecessary financial stress.

Several alternatives such as buying items on credit and receiving cash payments, buying and selling gift cards, or retail arbitrage can help get cash from credit card without charges. It merely requires some innovative thinking.

Resources

What Is a Credit Card Cash Advance Fee? Experian
Credit card limits, explained. Chase
Wells Fargo Reflect® Card. Well Fargo
How long does a balance transfer take? Bankrate