Why logbook loans are popular

The pain of being turned down for a loan simply because you have bad credit cannot be explained. Credit checks are a standard operation procedure for many financial institutions and are the reason many people have been declined when seeking for credit. Basically, mainstream lenders cannot advance you credit if they feel like you are a risk to them. In fact, if you have a history of CCJS and defaults, you can be rest assured that you won’t be advanced for a loan from mainstream financial institutions. Does that mean that your goose is cooked? Of course not!

Logbook loans have been instrumental in helping people with bad credit get a cash advance without having to go through the painful process of being rejected. Though a fairly recent phenomenon, logbook loans have become popular beyond measure. The idea that people with bad credit can get advanced a loan without being grilled or state reason for which they require the loan is something that is irresistible to many people.

How does it work?

As the name implies, logbook loans are loans secured against a person’s logbook. The basic requirement is that you must legally own a car. If you own a car, in bad credit and in need of a loan, logbook loans are your remedy. You simply approach a lender of your choice across the UK; provide proof of car ownership (logbook), state the amount you require and the process begins. If your car has no financial attachment, and you are above the age of 18 years, the process should be pretty simple and the approval would be first. Upon providing your logbook, you sign a bill of sale agreement that specifically states your lender is the temporal owner of your car until you clear paying for the loan. The beauty of this kind of loan is that you will still be using your car while you make repayments and that no additional collateral is required.

What are the benefits?

Logbook loans are very popular not only in the UK but also in other parts of the world. The idea that people with bad credit can get a loan without having to worry being turned away is something that most people find attractive. The number one benefit is of course the fact that no credit checks are required. So long as you are a UK resident, own a car and can provide proof of income, you are good to go. Secondly, the application process is simple and approval is fast and the moneys are availed to you within the same day.

To sum it up, logbook loans have been instrumental in providing people with logbook loans a new lease of life and that by all means is what makes it very popular. However, the interest rates are unusually high and should a person fail to make repayments as agreed or falls way back, the lender can repossess the car and sell it. If the proceeds from the car were not enough to clear the loan, the borrower could be taken to court to be forced to clear the outstanding amount.