Unexpected expenses and financial emergencies can come at you when you least expect it. That’s why they are called emergencies. You’re lucky if you have an emergency fund to fall back on. So what happens if you’re fresh out of cash and you have no one who can help you financially? What’s even worse is if you have a poor credit score, which makes you ineligible for majority of personal loans.
Thankfully there are alternatives such as logbook loans. If you’re thinking of resorting to this type of loan, here’s a quick guide to help you better understand the financial product.
Logbook Loans Overview
Logbook loans are personal loans offered for people with bad credit. When you apply for this loan, you don’t have to worry about credit checks. To be eligible, you just need to be of legal age, a UK resident and a vehicle owner. The loan will be secured against your vehicle essentially putting up said asset as collateral or security. This makes logbook loans secured personal loans with the possibility of vehicle repossession if you are unable to repay your loan.
Loan Amount Offers
Since there’s a security involved, borrowers are able to borrow more than if you simply settled for an unsecured loan. In general, you can borrow between £500 and £50,000 at representative APR of 400%. Repayment terms start from 12 months up to 36 months. You can choose to repay the loan bi-weekly or monthly. If approved for a logbook loan, you can use the money any way you want. Lenders rarely ask borrowers the reason for the loan. As long as you meet the eligibility criteria, you won’t have to worry about anything else. To check out the best logbook loan offers available in the market, the SimpleLogbookLoan Company is a good place to start.
As mentioned above, the requirements for a logbook loan are minimal. In general, you just need to meet the basic requirements including being of legal age, a UK resident and an owner of a vehicle registered under your name. You’ll then be required to submit the following documents, which you’d want to prepare prior to your loan application for a speedy approval:
- V5 document
- MOT certificate
- Insurance details
- Recent pay slips
- Proof of identification
- Proof of billing address
While the loan is easy to access and ideal for borrowers in need of quick cash, the loan is pretty risky not to mention costly. The interest rate is pretty steep. But other than the high representative APR, the loan puts your vehicle at risk. You may lose your car in the process if you delay or miss payments. As detailed on the loan’s terms, you agree with your lender recovering your vehicle in case you are unable to repay the loan. The lender can also opt to resell your car if necessary.