Cash advance apps vs a loan
Two shapes of debt. Pick the one that ends.
A cash advance app is cheaper than any loan for a small gap you can close on one payday. The trouble is the shape: it takes the whole advance back, leaves the same hole, and you borrow again. Here's the loop, the staircase, and the line between them for your amount.
The loop and the staircase.
Same $300 gap, same six months. One of these costs almost nothing per turn and never ends; the other costs something once and does.
The loop.
Advance $300. Payday takes $300 back. You're $300 short again, so you advance $300. Thirteen times in six months. On a fee-free app the fees are $0 and the loop is still a loop: the paycheck never gets its $300 back.
The staircase.
Borrow $500 once (the $300 gap plus a little room). Six fixed payments of $92.30; each one is smaller than the hole was, and the sixth is the last. $53.78 in interest at 35.99% APR, and the paycheck is whole again at the end.
The line, drawn for your amount.
Rows are the gap. Columns are how long until you can truly be done with it, not just repay it once. Green: an app wins. Blue: a loan wins. Amber: neither; something else is going on.
| Gap | Done next payday | Done in a month | Done in 3 months | Done in 6+ months |
|---|---|---|---|---|
| $50 | $0 appEarnIn, MyPay | App or billerask for two weeks | Neithera $50 gap that lasts 3 months is a budget, not a loan | Neither |
| $100 | $0 appthe FrontPay advance costs $9.99 for this | Appone re-borrow is fine | Neithersee the loop | Neither |
| $300 | $0 appif you have direct deposit | Short-term, 3 paymentsno re-borrow | Short-term, 3–6 paymentsends on a date | Installment $500 minor fix the budget |
| $500 | App, if the cap allowsmost start lower | Short-term or installment$92.30 × 6 | Installment, 6 mo$53.78 interest | Installment, 12 mo$50.23 × 12 |
| $1,000 | Short-termif one check carries $1,150 | Installment$184.59 × 6 | Installment$184.59 × 6 | Installment$100.46 × 12 |
| $2,500 | Nobody repays $2,500 in one checkpick a longer horizon | Installment$461.48 × 6 | Installment$461.48 × 6 | Installment or personal$251.14 × 12 |
Loan figures at 35.99% APR. Apps assume you qualify for the amount, which new users often don't. Representative example: $2,500 over 12 months at 35.99% APR is $251.14 a month, $3,013.71 total. Your offer shows your rate before you sign. The route finder does this for any number.
Six months of a $300 gap, priced.
What re-borrowing $300 every payday for six months costs on each app (thirteen advances, memberships counted), against borrowing once and ending it.
Fee-free wins on dollars and we say so. It also leaves the loop running. The honest comparison is the second column of the grid above: can you be done? All six apps compared · The $400 number line
Apps vs loan
questions
More in the full FAQ.