It is a shame that most people cannot get a personal loan because they are unemployed, self-employed or because their monthly expenses are higher than their income. In other cases, this may be because they do not meet the minimum net income requirement.
Another reason you may be denied a personal loan is due to poor credit history, defaults and late payments on other loans – even if your salary qualifies for the loan. It is normal for the payday lenders to run a credit check every time you apply for a loan from them to see your credit status. But what happens if you don’t get a personal loan? What other options are available to you?
Logbook loans
If you own a car and live in the UK, there’s a good chance you’ll qualify for a logbook loan. These loans offer same-day secured loans using your car’s logbook as collateral.
Fortunately, there are several companies across the UK who are willing to offer you logbook loans. However, when looking for lenders, stick to those with a consumer credit license that allows them to offer such services. The Financial Conduct Authority grants this license. Such lenders are seen as equal players that you can trust. It is also important that you read their online reviews before entering into an agreement with the lender.
The main advantage of loaning logs is that they can be obtained very quickly, with the process normally taking around 24 hours. Another reason why this option appeals to people with bad credit is that there are no credit checks. This means that even with a bad credit score, your logbook loan can still be accepted. This comes as a relief to most people who are dealing with bad credit score and struggling to get loans in the market.
Eligible for logbook loans
What do you need to qualify for a logbook loan?
- Applicant must be the legal owner of the vehicle with the logbook.
- The vehicle must be completely or almost completely free of financing; if you have two months or less of repayment, some lenders may still accept you.
- The vehicle must be eight years old or younger.
- Applicants must choose from loan terms with early repayment and a payment term of up to 78 weeks; Early settlement does not entail a penalty.
- Applicants are required to drive their car and drive back with the money applied.
- Applicants keep their car while the logbook remains with the lender.
Some logbook loan providers have been around for more than a decade. They have built a strong reputation as responsible lenders. Most of these companies require the applicant to complete an income and expense form to prove that you can afford the loan you are applying for.
Of course, APRs of up to 437.4% are common. While that is quite high, the rate can be significantly reduced if you opt for an early settlement. Please note that there are no early statement fees.
Photo credit: Omar Omar
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