Logbook Loans for Car Owners
Logbook loans constitute an alternative, but only if you have exhausted all other loan application options. If you are a car owner, and you definitely do not have any outstanding loans tied to your car, you may be eligible for a logbook loan. Keep in mind that:
  • Logbook loans can be very expensive
  • Typical APR may reach 437% or even more
  • Unless you need cash for an emergency, logbook loans shouldn’t be used
You may have to pay for an emergency such as a medical bill, or a tuition fee which must be paid right away for example. Logbook loans are not intended for cash in order to pay for your holidays; if this is the case, you should opt for a personal holiday loan which comes on much better terms and conditions - lower APR, higher loan value, etc.
Some other criteria that must be met in order for you to be eligible for the loan:
  • Your car shouldn’t be older than 8 years
  • It must be in a perfect condition (consider the fact that lenders do take up a certain level of risk as well; if something happens to your car, while you haven’t paid off your loan, the car cannot be sold, so the lender cannot recuperate his loss).
  • The value of the loan will not exceed £50,000 (and as low as £500)
  • The logbook is offered to the lender as a guarantee – this way you have placed your car as collateral to the loan
  • You must show a stable proof of income (self employed individuals are generally not eligible for this type of loan, due to the fact they cannot make proof of stable monthly income)
  • Auto insurance is a must when applying for a logbook loan
These are the basic criteria you must fulfill in order to be granted a logbook loan. Just to get a better picture of how it works, consider the following: a loan of £1,500 with a typical APR of 437.4% with a loan term of 78 weeks, you will have to pay around £54/week. And, summing it up, you will have a total repayable amount of £4,200. Thus, you really need to carefully weigh your options, and see whether such a loan would benefit you.

Make a thorough research before applying, and try to find a lender which charges you the lowest interest rates, and generally offers you and affordable repayment schedule.