There are often times when a consumer will need access to a source of short-term liquidity. This may be to pay an outstanding bill or to perform emergency repairs on a home. Unfortunately, those with poor credit may be precluded from applying for a traditional loan. Logbook loans are a possible alternative, as these will use one’s vehicle (hence the term logbook) as collateral in terms of repayment. For this reason, a logbook loan can prove to be a viable option. For clarity, let us examine these loans in more detail.
Top 4 Logbook Loans
|Provider||Interest Rate||Min/Max Loan Amount||Loan Term|
Car Cash Point Logbook Loan
|230.7% APR||£500/£100,000||up to 5 years||More info|
EasyLogbookLoans.tv Logbook Loan
|180% APR||£750/£10,000||12 months to 3 years||More info|
Logbook Loans Pro Logbook Loan
|300.30% APR||£500/£25,000||1 month to 3 years||More info|
Gissaloan Logbook Loan Gold
|154.87% APR||£500/£25,000||3 months to 2 years||More info|
Types of Logbook Loans
The type of logbook loan will centre around the amount of money requested, the interest rate and the repayment period. Most loans will have a withdrawal limit of a few thousand pounds and the borrowing period can last from a few weeks to a few months. This will frequently be determined by the requirements of the applicant and the value of the vehicle.
It should be noted that as these instruments are primarily used with those who have damaged credit, the lender will be placed at a greater risk. Thus, interest rates can be prohibitively high and these always need to be taken into account during the application process. These rates will obviously vary from lender to lender and customers should compare services accordingly. In some ways, a logbook loan can be viewed as a secured loan (due to the presence of a vehicle as an underlying asset).
Things to Take into Consideration
The most important factor is how the money is to be used. A logbook loan should only be chosen when other options are unavailable and the funds requested are critical (for instance, to pay utility bills). Even then, only the exact amount of cash required should be chosen. Let us never forget that failure to repay this loan can result in the seizure of a vehicle. It is critical to make absolutely certain that the conditions of the lender are met. A default can further damage credit while the applicant will not be able to request another loan.
How to Get the Best Deal
Some lenders are notoriously unscrupulous. In certain instances, the “fine print” attached to a loan may result in hidden fees and other superfluous charges. So, all of the terms and conditions need to be carefully read. Some other variables to remember are:
- How long has the lender been in existence?
- Are there negative reviews associated with their services?
- Are the interest rates fixed or variable?
- Is there a grace period before repayment begins?
With prudence and foresight, a logbook loan can be a beneficial instrument. Still, proper research needs to be performed.