What is the difference between a second mortgage and a cash advance loan? A second mortgage is a long term loan that is secured by a lien on your home. A cash advance loan is a short term, high rate, unsecured loan, usually up to $1500, where the loan is to be repaid on your next payday. 

When a cash advance loan is approved, usually the borrower authorizes an automatic bank withdrawal, or writes a post dated check to the lender for the amount of the cash advance, plus the lenders fee. The lender then gives the borrower the amount of the check, minus the lender's fee.

The fees charged for a cash advance loan are typically a percentage of the amount loaned, which can be 15% to 20%. Lenders are required to provide a truth in lending disclosure that shows the full cost of the loan. The term of the cash advance usually ranges from about one to two weeks, with time extensions available, but more fees are charged for each extension. 

The purpose of a cash advance is to provide a way to pay for emergency or immediate expenses that cannot wait until your next paycheck. While the fees can be high, they can be less than alternative expenses, like late charges for utility reconnection, rent penalties, or bounced checks. 

A borrower's credit rating does not matter with a cash advance. Late payments, collection accounts, or other credit issues do not affect the approval for a loan. A second mortgage provides lower rates and a longer term for repayment, but credit scores and loan to value are important factors.

If you decide to use a cash advance, just remember that it is only a short term loan, and any extensions can be very expensive. Borrow only as much as you will be able to repay with your next paycheck and still have enough money to live on until the following payday.