It is important to make sure that you are fully aware of how these text loans work to see if it suits your situation or not.
What is a text loan?
Text loan is a small cash advance typically up to £1000 that has to be paid off in one bulk payment within 30 days. It can be used for bridging the gap between paydays especially if you find yourself struggling financially to cover some unexpected expenses like car repair, medical bills, urgent household repair and more.
These are also sometimes called the SMS loans that are quick and easy to arrange on the go. You simply need to get a text loan account approved in advance that you can use any time in the future to get quick cash transfer to your account. A pre approved account means that you do not have to go through verifications or documentations at the time you need urgent cash. All of these formalities are attended to at the time you get a text loan account approved.
What are the consequences?
The ease of obtaining a text loan makes it an attractive option for solving immediate money problems. But there are a number of risks associated with it. For example, these loans are only suitable if borrowed for short term of up to 30 days. But users tend to apply for these loans in a haste to cover their urgent expenses without making proper budget plans for how to pay it back in time.
Not paying the loan on due date invites big troubles. The most immediate consequence of missing the payment is the extra interest rate charges that are added to the loan amount that you owe. There can be other additional charges such as late payment fees.
Apart from these short term troubles, there can also be a longer term impact of missing a loan repayment, and that is a bad credit remark on your credit register. No matter if you pay the loan on the immediate next date, ut once it is there on your credit file, you may have to face the its consequences for a very long time. You may be refused for credit cards, over drafts or other personal loans even if you meet other requirements of the lender.
Therefore, if you are not sure how to pay back your loan by the due date then it is advisable not to take one out. If you are already in debt then these text loans are not for you as they can make your debt problems worse. Know more feel free to visit at http://www.textaloan.org.uk/