Ever been in a situation where you need cash urgently but unable to avail a logbook loan simply because you have a poor credit rating? If yes, then you can take consolation in the fact that you are not alone. Majority of UK citizens with a poor credit rating suffer from the indignity of rejections to loan applications simply because a less than average credit score. It is known that the unveiling of logbook loans in the UK a few years back was received with pomp and glamour. UK individuals with a low credit score could now avail a loan without having to worry or go through a strenuous application process.
So what are logbook loans?
A logbook loan from the very sound of its name is the type of loan where a car’s logbook is used as collateral. In essence, you can only apply for a logbook loan if you own a car that is quintessentially registered in your own name. It differs with a car loan in the sense that with a logbook loan, you already own a car but simply use it as collateral to avail a loan while a car loan is the type of loan where you seek a personal to say buy a car or something along those lines.
Why are logbook loans popular?
It is not by default that logbook loans are popular among UK individuals. For starters, it’s imperative to note that in order to get approved for a SimpleLogbookLoan, you simply do not need to have a stellar credit rating. In any case, logbook loan lenders do not carry out credit checks which means that a person can be assured of an approval irrespective of how poor their credit score is. The second reason why logbook loans are popular has to do with the fact that the application process is pretty simple and approval is done within hours. Thirdly, you can get access to a loan up to 70% value of your car which means it is the perfect loan product especially when you need a huge sum of cash. Fourthly, you do not have to give up your car when you apply for this kind of loan but rather continue to use it as you make repayments for the loan.
What is required prior to applying for a logbook loan?
It is imperative to note that the requirements to apply for a logbook loan in the UK is pretty simple. For one, you simply must be a bonafide citizen residing in the UK. Secondly, you must legally own a car registered in your own name. What this means is that you cannot use your wife’s car or a friend’s car as collateral when applying for this kind of loan. Thirdly, you must be a person of legal age. What this means is that you must at least be 18 years. In addition to the aforementioned, you should furnish your lender with a ministry of transport certificate, insurance and tax details, proof that you get a monthly income, as well as ensure that your car has not been in use for more than 10 years.
Are there risks to taking a logbook loan?
Well, to begin with, failure to make your repayments could lead to your car being repossessed. In most cases, logbook loan lenders repossess your car as a last resort after efforts to contact you to make repayments come to naught. On the downside though, logbook loans attract high interest rates and you can end up repaying up to twice the principal amount of money you applied for.