What to Know about Logbook Loans
Logbook loans maybe one of the easiest personal loans to avail today but it still always pays to do your homework if you're planning to take out a loan anytime soon.
What is a logbook loan?
A logbook loan is a type of personal loan that is secured against your car. It is a short term loan option offered to people who need quick cash for a variety of purposes. But more importantly, the loan is designed for people who have bad credit and have been refused a loan elsewhere.
How much can you borrow?
With logbook loans, you can borrow between £500 up to £50,000. It's more flexible compared to unsecured options hence more favorable for people who need larger cash for immediate and pressing financial needs.
The amount you can borrow will primarily depend on your car's make, model and official trade value. In general, you can borrow up to 50% of the trade value. Also a factor is your income as lenders must assess whether you can handle the monthly repayment dues.
How repayment works?
When it comes to repayment terms, as borrower, you have complete freedom to set the duration of the loan starting from 3 months up to 5 years. You can also choose to repay it weekly or monthly depending on which set-up is more comfortable for you.
Typically, repayment is done through you debit card which leaves you with the job of ensuring that you always have enough funds to cover your monthly dues.
Where can you apply for one?
With more logbook lenders setting up online portals than ever, you can now apply from the comforts of home. The process is convenient and fast. All you have to do is fill out the online form, wait for a confirmation with regard to the status of application and expect the money within a day or less once approved.
What are the potential risks?
Like any other type of loan, logbook loans have its risks too. The biggest is repossession. Because the loan requires you to have a collateral or security, failure to keep up with the repayments can mean losing your car. To avoid that from happening, make sure you know exactly the terms and conditions of the loan and commit to pay on time and regularly.