Text loans are a form of payday loans aimed at good and bad credit borrowers stuck in emergencies or rather embarrassing situations. The application process for any kind of small loan is more or less the same.
You just need to put in the application form, and then a lender will look over your financial details to determine if you can afford to pay back. If you manage to prove your repaying capacity, you get the nod in just a few minutes.
However, a few situations are out there you can find yourself stuck in when you will want money in your hand in the blink of an eye. For instance, you have been mugged as you step out of the bank, and now you are short of money you had to take to the hospital for the treatment of your mother for example.
Likewise, as you are about to check in at a metro station, you realise that your pocket has been picked up. You have no money and no wallet. In such embarrassing and awkward situations come text loans.
How are text loans helpful?
You should have a smartphone to be eligible for text loans. Just send a text to your lender to inform them how much amount you require. You must be registered with your lender to be eligible for these loans.
A lender may not lend you money through these loans if you are a first-time borrower. This is because a lender must have your financial details that they will consider to decide your affordability.
If you are a first-time borrower, you will have to initiate the process from the very start. These loans, then, will be payday loans, not text loans. When you have your details with your lender, you will get money within 10 to 15 minutes after sending a text message. These loans are also called SMS loans.
What are the features of text loans?
Text loans are short-term loans that can fund your smaller needs. You can borrow as little as £100, and the maximum amount you can borrow is £1,000. If your income is consistent and you can afford to pay back the money you are borrowing, you will have a lender sign off on your application.
The loan amount could be disbursed to your account within a couple of minutes. The best advantage of these loans is the fastest disbursal. Whether you are n employee, employer, homeowner or tenant, you are eligible to apply for these loans.
Another benefit of these text loans is that you can get them as a subprime borrower too. A poor credit rating often comes your way of qualifying for a loan at affordable interest rates, but text loans are not as expensive as payday loans.
A reliable lender will lend you money at lower interest rates. Though you will end up being charged a bit higher interest than those with good credit borrowers, you will still find them more manageable.
In fact, some of the lenders will allow you to repay the debt in weekly or bi-weekly instalments. It makes the settlement of the debt easier. As you will be able to take out a text loan from a lender from whom you had borrowed before, it is crucial that you do research at that time.
This is because each lender asks for various interest rates. Try to pick the one that offers lower interest rates. Some websites make the comparison. They may help you make a decision. You can also discuss interest rates and APRs by communicating with a lender.
Do not shirk research at this stage, as this is the key to getting the best interest-rate deal. Text loans from direct lenders in the UK may also charge different interest rates. If you have already picked a lender offering you an amount at the most affordable interest rates, you will also get affordable text loans.
How these loans differ from other small emergency loans
Though you can get text loans approved within a couple of minutes, it does not mean that these are the best loans for all types of emergency situations. First, these loans are limited because you need to be registered with your lender.
It is likely that the interest rates of these lenders are not as competitive as that of other lenders. Further, these loans are mainly aimed at helping you tide over when you are stuck in an awkward or embarrassing situation.
Other small loans are also aimed at funding emergencies, but you may not need money within a couple of minutes at that time. For instance, you have got to repair your tumble dryer or car.
In such a situation, 100% acceptance of payday loans in the UK will come in handy. If you have a bad credit rating, you should also consider applying for bad credit loans. It is likely that you will get these loans at more affordable interest rates.
If possible, you should opt for a loan allowing you to pay over an extended period. This helps improve your credit score. Before you take the plunge, you should carefully decide which loan will suit best to your needs.
For instance, text loans and payday loans require you to pay back the whole of the debt in a two-week period, but some loans come with a more extended repayment period.
Likewise, if you are out of work and looking to apply for a loan, these loans will not help solve your purpose. You will need loans for the unemployed. Your passive income will be considered to determine your repaying capacity.
The final word
Text loans from direct lenders are the best loans when you need money further ado. The best part of these loans is that you can get the approval at once after sending a text message.
However, at the same time, you need to think about what kind of loans are actually suitable to your needs so that they can solve your purpose and you do not fall into debt as well.
Jessica Rodz is the Senior Content Writer at Cashfacts. She has a long career in the field of content writing and editing. Jessica has the expertise in the UK lending marketplace where she has worked with 7 different lending organisations and acquired many responsibilities from preparing loan deals and writing blogs for their websites.
At Cashfacts, Jessica is managing a team of experienced loan experts and doing a major contribution in guiding the loan seekers via well-researched blogs. She has done graduation in Business (Finance) and now currently doing research papers on the UK financial sector.
