Should You Get A Logbook Loan?

What Exactly Is A Logbook Loan?

A somewhat different concept, the logbook loan is a way of borrowing money by using your car or vehicle as the main security against the loan. Usually, the more your car may be valued at, the possibility is that you could borrow more.

As with any lending product, it's always best to make certain you consider all your possibilities prior to signing for anything, and to shop around to get the best provider.

Advantages of Logbook Loans

. Can Be Lent Bigger Quantities

As you are making use of your car or vehicle as the primary security for the loan, it is most likely that you will be able to borrow a larger amount of money, than the other options like payday advances.

. Could Get A Loan With Adverse Credit

Because your approval for one of these loans is based on your ability to pay the loan back rather than any negative credit history, it means that you're able to get a loan even though you may have a bad/poor credit history or perhaps no credit rating at all.

. They're Convenient

As the application process is so uncomplicated, it is usually approved on the day which you apply. All you've got to do is fill in a form online to confirm that you're the owner of the car or other vehicle and also have the logbook.. This whole process means that you can have the money in your bank account within an hour in the majority of cases.

Downsides Of Taking Out A Logbook Loan

. Higher Interest

Like other loans of this nature, one of the main disadvantages is the high interest that's charged.. The APR used to calculate the rates of interest is something that has continually been a controversy when talking about these kinds of lending options, as usually this method is used in relation to annual financial products. Regardless of this fact, there's no avoiding the fact that the interest rates are high, there should be no troubles however if the money is repayed on time.

. If They Are Not Paid, You Could Lose Your Vehicle

One risk with making use of your vehicle as security for the loan, is that if you do not entirely pay back the loan, then you will likely lose your car. If you're ever in a position in which you don't believe that you will be able to make your repayments, then contact your loan provider right away, as they could probably help you.

. You Must Own A Vehicle

One problem with applying for a logbook loan would be that the person who is applying for the loan has to be the legitimate owner of the car. This does mean that if you aren't an owner of a vehicle then you won't be in a position to obtain a logbook loan. There is also the fact that you actually have to give over your logbook and you will be without it until you pay off the loan. This doesn't affect your ability to drive your vehicle around as normal though.