We all have come across the situation of not being able to make payments during the middle of the month due to poor financial condition. Loans have become an integral part of our lives and it is tough to find someone who has not taken out loans and who has had no burden of making loan payments every month. There are various types of loans like personal loans, fast cash loans, quick loans which are borrowed by individuals depending on their respective financial condition. After taking out too many loans, people may even accumulate a big amount which might become impossible for them to repay.
If you’re someone who is under the pressure of paying your soaring bills, you can consider borrowing a small amount of money for a short span of time as this may seem to be a win-win situation. But before you tempt yourself to get a quick cash loan in UK; you should know few facts on this loan type before taking the plunge.
- Interest rates usually remain pretty high
Since the lenders are offering you fast cash soon after applying for the loan, they will certainly charge you for high interest rates for the prompt service they offer you. Payday lenders require publishing Annual Percentage Rate (APR) and this is actually the interest that you would pay if you borrowed the quick loan for an entire year. 5000% or a bit more than that is not something unusual. Hence, you have to be careful about borrowing these funds so that you don’t keep accumulating charges for late payment.
- Lenders are given access to your bank account
Majority of the quick cash loan lenders collect payments from your debit card account. You are allowed to give CPAs or continuous payment authorities to lenders where you give them the permission to debit payments from your bank without checking out your convenience. If you don’t have enough money in that account, handling your finances will again become difficult.
- Quick cash loans are short term loans
Quick cash loans are short term loans and the lenders usually expect you to repay the money on the next payday in a chunk. As per reports from the Office of Fair Trading, 35% of the borrowers who take out such loans don’t pay back on the right time and they instead roll over the loan borrowing the same amount again and by just repaying the interest rate. When you do this time and again, you keep paying interest without paying back the principal amount.
- Do your calculations before you take the loan
It’s vital to make sure that you know the exact amount that you will require paying back in total before you apply for the loan. There are few lenders who make it extremely simple for the borrower to understand the total cost of the loan and the total time you will take to pay it back. You can utilize the quick cash loan calculator to calculate the interest rates and the amount you have to pay.
- If you don’t pay it back on time, you will be intimidated
In case you don’t pay back the amount on time, the lenders will want to get in touch with you and know what the issue is that is keeping you from making payments. Some lenders can contact you to chase you for making payments on time. The Office of Fair Trading found out that there were many cases where consumers were called at work around 16 times a day.
Therefore, if you’re desperately looking for immediate cash to meet your mid-month expenses, you can definitely take out quick cash loans but make sure you know the few important facts mentioned above before taking the plunge.