To increase CC usage every month will cash advances look good or bad & do they help?

[Anonymous]

Since I've seen the light from this board and Credit Board I now understand that to really help your chances in the future to increase one's current credit line limits it's best to try to run as much through your CC's as possible everyday instead of just using your bank debit card, cash or writing checks.

One poster on this board stated he was running $10-$15K a month on a $5K limit card

My question is two fold.

To help with mass usage of my credit cards (on all my personal and different businesses I own for day to day, monthly and yearly expenses) will CASH ADVANCES help or hurt me in the eyes of the credit card companies in regards to helping me increase my credit limits? Basically do CC companies see someone that takes cash advances differently then someone that spends the exact same amount on some product or service?

Like they're in need of the cash and more of a risk to them. For example instead of paying a contractor for work they do for you with a check you could pay them in cash through a CC cash advance. Yes, you'd get hit with a 2-3% fee. But you would get to run more transactions through your credit cards and thus in theory you would use your CC's more instead of just for purchases of products or services.

Again from everything I've read, besides keeping your CC at a zero balance and then leave $2 on one card every month. For maximum chances to increase your credit lines the more transactions the CC companies see you do every month the more likely they are in the future to give you a CLI but also a bigger one correct? 

Please chime in with your first hand experiences with this.

Thanks so much.

I'm finally finalizing my Christmas Breaking Bad marathon (watching Season 5 episode 11) so all his cash got me thinking!

[lg8302ch]

Stay away from cash advances. Save your money for something else! Use your credit cards for everything you would need to pay anyhow and do not start MS... this is my advice. I maxed out my Freedom a few times and never got a CLI but all the other cards with regular use (not more than 10%) got me nice limits. There is no need to show extreme usage to get high CLs... remember not everybody has the same income...so if I would start heavy usage on my cards that could probably go the other way around as my income would not support this and lenders could find it too risky and CLD or even close accounts. I am for normal use compared to income ..just my 2 cents.

[Suddenlyy]

save that money for yourself instead of giving it to the banks in cash advance fees and APR hikes. like previous poster said, you dont need to show extreme  usage. 

besides, i highly doubt a cash advance would look good to your creditor. in fact, id think quite the opposite. if i was a bank, if i saw someone willing to take a CA fee and  huge APR hike - especially multiple times or for large amounts - id think they were in a financial bind and therfore not a prime candidate for a cli. just my opinion.

[Anonymous]

Like they're in need of the cash and more of a risk to them.

Yup.  You can tell how banks feel about them by how they jack up the rates.

--Lose your introductory grace period

--Pay a cash advance fee

--Interest rate is usually 5-7% higher

--You look desperate to the bank

It's like a payday loan, never, ever do these unless you're in dire straits.  

Actually, I guess there are situations that they could be useful.  Here's an example that I was reading about online where it would be not such a bad idea:

A financial planner who lives in Knoxville, Tenn., plans to use a cash advance from his Mastercard to buy a used video camera for his 26-year-old son, a professional photographer who doesn't have a credit card.

His son plans to buy the camera from an individual, not a store, and needs to use cash. Without his own credit card, the son has few options. "The market doesn't have a lender for that, and if it does, you wouldn't want to cross their door," Lewis says. His son will write the monthly checks to the credit card issuer to repay the loan, a strategy Lewis hopes will introduce his son to the habit of borrowing money and repaying it in a timely fashion.

Lewis has done the math: Using a promotional deal on his MasterCard, the $2,000 cash advance will cost $2,114.74. That's the amount of the advance, an $80 fee and a month's worth of interest at 4.99 percent. He says the interest and fee will be reasonable -- that is, if his son pays the loan back within a month. Lewis is keeping his fingers crossed. "Cash advances work if you have the discipline to pay it off. If you don't, the penalties are pretty high," he says.

That's one example, just to be fair.  But, mostly they suck huevos.

[Anonymous]

@lg8302ch

You're not understanding what I was asking and how/why I would do this. I wouldn't take cash advances out because I need the cash nor would I max out the card ever before I would pay it off WEEKLY like the guy that was running $10-$15K a month through on a $5K limit card. Also what someone or some credit card company deems extreme usage could be considered light usage to someone else or to another credit card company. It's completely subjective. 

[mitchblue]

Seems like a bad idea. I don't believe a cash advance helps in anyway with regards to CLI and the such.

[lg8302ch]

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@Anonymous wrote:

@lg8302ch

You're not understanding what I was asking and how/why I would do this. I wouldn't take cash advances out because I need the cash nor would I max out the card ever before I would pay it off WEEKLY like the guy that was running $10-$15K a month through on a $5K limit card. Also what someone or some credit card company deems extreme usage could be considered light usage to someone else or to another credit card company. It's completely subjective. 

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Or let me put it in simple words. If you have the income that supports this large spend on the cards then you do not need cash advance to show such usage.

[Anonymous]

What I am asking the board (the heavy hitters in particular) is not to do one or the other (cash advances vs purchases) I am asking if adding a couple hundred to a couple thousands dollars of cash advances every month on CC's and then paying them all off every month would be even MORE helpful (or hurtful for that matter) then just the heavy purchase usage in regards to future CLI and showing heavy usage to help push CLI's up. Maybe I wasn't clear on this on my post, my apologies. 

[lg8302ch]

Just so you know it can be done with normal spend.  My total CL is more than 2 x my annual income and I NEVER used the cards for anything else than my normal spend. You can get high CL without the abnormal use of your cards!

If you decide to go ahead with your little game please do not come back and cry ...my accounts got closed for no reason  - Good luck!

[IamB2]

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@Anonymous wrote:

@lg8302ch

You're not understanding what I was asking and how/why I would do this. I wouldn't take cash advances out because I need the cash nor would I max out the card ever before I would pay it off WEEKLY like the guy that was running $10-$15K a month through on a $5K limit card. Also what someone or some credit card company deems extreme usage could be considered light usage to someone else or to another credit card company. It's completely subjective. 

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If I understand you correctly you don't need to spend this money, but you are willing to pay the cash advance fee just so you can show additional "usage" in hopes to get higher CLIs. Then you plan to use the cash you got from the cash advance and pay it off right away. Do I have this correct?

If so, well, that is called Manufactured Spending, (MS for short) and it is pretty much a No-No with any Credit Card issuer. There are countless stories that the issuers have closed cardholder accounts for this reason. Don't do it. It is a bad idea. CLI will happen with time, and if they don't as your profile ages, you will get better cards with higher credit limits and then you close the ones with lower limits. 

Hope that answers your question.