Logbook loan being a form of secured lending operates on collateral. When you make a request for a loan and are approved, you will be required to exchange the ownership of your car with the lender .i.e. the provider becomes the legal owner of your car for the loan period until you pay and clear it up. Logbook lending is becoming the favourite source of quick cash for many. This can be attributed to the fact that credit history is a non issue with logbook lenders. It does not matter how bad your credit record is; your chances of approval for a loan are always high. What matters most is your affordability, that is, your ability to comfortably pay back the loan for the entire term.
- Most logbook loans are flexible and can always be adjusted to fit your circumstances. For instance, if you are struggling to pay your monthly instalments, you can always speak to your lender and they will help you out.
- A log book loan is very convenient as it involves a very short process of approval and disbursement of funds. Within 24 hours of sending in your application, you will be having your money in your account. Additionally, even though you use your vehicle as security, you will still keep and drive it as usual. The only thing you leave behind is your V5 document.
- These loans are very reliable making them a great choice for emergency situations. At no given time will your application be declined unless you do not have the proper documentation that the lender wants. Your credit score does not matter, all that matters is that you be a legal owner of the car you want to use as security.
- A logbook loan is pretty expensive as it involves very high APR rates. Additionally, anytime you delay or default a payment, it means more fees. That is why only a very worthwhile excuse should make you overlook the high cost of this loan.
- You risk losing your vehicle. As a result of the transfer of ownership which is legal and documented, the lender has all the right to come and claim your vehicle if you cannot keep up with payments anymore. After all, it’s what you placed as security. So before you sign up for a logbook loan ensure you can comfortably pay it back fully to avoid losing your car.