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Frequently asked questions
How many Lines of Credit should I have?
The number of credit lines you need depends on your financial situation and budget. Opening multiple Lines of Credit can demonstrate financial responsibility and the ability to manage debt, which can help when you’re trying to qualify for a mortgage or loans with better interest rates – but you should never borrow more than you can afford to repay.
Do Cash Advances (Payday Loans) have unreasonably high interest rates?
Depending on your loan type and state, a Cash Advance charges a flat fee and does not have interest accruing fees. The typical fee for a Cash Advance is $15 per $100 borrowed — a set price for a short-term transaction. This makes a Cash Advance often less expensive than bouncing a check, missing a credit card payment or neglecting a bill.
The Federal Truth in Lending Act (TILA) requires all financial institutions to disclose loan fees as Annual Percentage Rates (APR). To comply with TILA, Advance America reports the implied APR of a cash advance — the amount you would pay if you renewed your advance every two weeks for a full year. However, the average loan term is only two to four weeks. APR is a more appropriate measure of costs associated with loans that last for at least a year, such as a mortgage loan or a car loan. However, even using APR as a measure of the cost of various options for short-term loans, Payday Loans and Cash Advances are still the least costly option compared to bank overdraft, bounced check, late payment and utility reconnection fees.
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Payday advance fee vs alternatives
Sources: CFSAA.com; Stephens, Inc. 2011; Moebs Services 2010 Fee Revenue Study; Bankrate.com; Readex Research National Data on Short-Term Credit Alternatives 2006; Moebs Services 2010 Financial Pricing Survey
Could Advance America charge a smaller APR?
Some of our critics have proposed capping interest rates for Payday Loans or a Cash Advance, but doing so would greatly impede our ability to operate. If we charged lower fees, we would not generate enough income to pay for basic business expenses, such as rent, utilities and wages. If we were to charge an APR of 36 percent, as some of our critics have suggested, that would mean customers pay a fee of $1.38 per $100 borrowed. No business — not a credit union, not a bank — can lend money for 10 cents a day for a two-week loan term without being subsidized. Such rate-cap models overlook the significant cost of operating a regulated business, and would be an effective ban on Cash Advances. Our customers recognize that the price of the one-time fee is appropriate for a short-term loan, relative to other options.
Can I refinance my Title Loan?
Yes, some states allow you to refinance your existing title loan at a better interest rate. During the loan application process, our employees will explain the options for refinance.
What is the average interest rate on a Title Loan?
Rates and terms will vary depending on your approved borrowing limit and state regulations. For more information, see if our Flex Line of Credit is available in your state.
What is the interest rate on Advance America's Line of Credit?
Rates and terms will vary depending on your approved borrowing limit and state regulations. For more information, see if our Flex Line of Credit is available in your state.
Can I refinance my Title Loan?
Yes, some states allow you to refinance your existing title loan at a better interest rate. During the loan application process, our employees will explain the options for refinance.