What Is a Flex Loan? And Should You Get One?

A flex loan is an unsecured, revolving line of credit with a set limit that you can borrow against, repay, and borrow again.

No matter your financial situation, a flex loan gives you easy, flexible access to money (up to your approved limit) at a moment’s notice, without the need to reapply for a new loan every time you want to borrow. 

How do flex loans work?

Once you're approved for a flex loan, you get a set credit limit. You can then borrow as much or as little as you'd like, up to that limit.

Also known as a personal line of credit or credit line, a flex loan only charges you based on what you actually borrow — not the full amount available. Depending on the lender, costs may come in the form of interest, fees, or both.

For example, let’s say you’re approved for a $1,000 credit line, but you only request $50. You'd only be charged on that $50 until you pay it off or borrow again. Either way, you can keep tapping into available funds as long as you don't exceed your limit and your account remains in good standing.

Advance America offers both a traditional interest-based line of credit and FlexFund, a fee-based line of credit. With either option, you're only charged based on what you borrow — not your full approved limit. Availability varies by state.

Are flex loans available online? 

Yes, you can complete the entire flex loan application process from home at any time of day. After filling out an application on the lender’s website, you’ll quickly receive the lender’s approval decision. If you’re approved, the money is deposited into the account you provided–sometimes as soon as the same day you apply. Once the flex loan funds are in your account, you can begin using them. 

At Advance America, FlexFund is available exclusively online. Apply once, and if approved, you can request funds whenever you need them without reapplying.

What are the benefits of a flex loan?

Flex loans offer several benefits, including:

• Easy application process: You can apply in minutes without any hassle. Most lenders have an easy application process with instant approval decisions. Plus, you can apply from the comfort of your home instead of filling out an in-store application (unless you want to).
• Get funds quickly: Flex online loans are funded quickly. Once you’re approved, you can start to draw funds that same day or within 24 hours, depending on the lender.
• Easy access to your funds: If you’re approved for a flex loan, you’ll have easy access to extra money whenever you need it. The funds will be available to cover any expenses, as long as you don’t exceed your credit limit.
• Good credit isn’t necessary for approval: Even if you have fair or bad credit, you can still get approved for an instant line of credit with bad credit. Lenders like Advance America consider factors besides your credit score when reviewing your application. For example, you may need to meet additional requirements, such as providing proof of steady income. 

Potential drawbacks of a flex loan

Before applying for any loan, it's important to understand all sides of the financial product. Here are some potential downsides to an online flex loan:

• Interest rates and fees: If you borrow from your flex loan excessively, interest and fees can add up quickly. Be sure to compare various offers to find the best rate for your budget.
• Risk of accumulating debt: Having an open credit line is similar to having a credit card; it's so convenient and flexible that you might overspend and use it to cover purchases you can’t afford.

Is a flex loan a good idea for you? 

There are several situations where a flexible line of credit could be a good financial solution. 

For starters, you can use the funds to cover an unexpected expense, such as a car repair, a veterinary bill, or a water heater replacement. Flex loans can also help you cover projects where you don’t know how much money you’ll need upfront, such as a kitchen remodel. 

What are the requirements to apply for a flex loan?

In many cases, you can apply online or in store. Before you start filling out your application, be sure to gather the following documents: 

• Government-issued photo ID, such as a driver’s license or passport.
• Checking account numbers.
• Social Security number.
• Most recent proof of income, like a recent pay stub.
• Voided personal check (this requirement varies by state). 

After approval, read the loan agreement carefully so you understand exactly when you’ll be able to withdraw money and when you’ll have to repay it.

4 alternatives to flex loans 

If a flex loan isn’t the right option for you, there are several other options for borrowers who need money but don’t have good credit:

Payday loans

A payday loan is a small, short-term cash advance loan you pay back in full on your next payday. The credit score requirements are often lenient because the amount you can borrow is based on your income. 

Installment loans

An installment loan is a loan you repay over time in fixed installments. Loan amounts, payment amounts, payment terms, and credit requirements vary by lender, so do your research to find a lender that works with borrowers with fair or poor credit. 

Secured loans

If you own a car or have another valuable item, you may be able to use it as collateral for a secured loan. Pawn shop loans and title loans are two kinds of secured loans that are relatively easy to get if you have bad credit. However, be aware that defaulting on the loan will result in the loss of your item. 

Credit card cash advances

Most credit card companies allow cardholders to withdraw cash advances up to their available credit limit. If you have a credit card with available credit, you may be able to get a cash advance loan that you’ll repay with your monthly payments. 

However, these credit card cash advances come with fees, including a cash advance fee of around 5% of the advance, plus a higher-than-average interest rate that begins accruing immediately. 

Get funds with an Advance America loan

Advance America offers two types of flex loans: a traditional line of credit and our online-only FlexFund. Both offer easy applications and, if approved, you may receive your funds as soon as today.^*

Ready to learn more? Find out if a personal line of credit is offered in your area, if you’re eligible, and what your maximum borrowing amount could be.

^*Online approvals before 10:30 a.m. ET (M-F) are typically funded to your bank account by 5:00 p.m. ET the same day. Approvals after 10:30 a.m. ET are typically funded in the morning the next business day.

Sources

1. Trustpilot: Advance America Reviews