You may have heard of logbook loans but are not quite sure exactly what they are, how they work, and, more importantly, how they can benefit you. But if you have a car – or a boat or yacht, a motor home, a caravan, or even an airplane – you might take advantage of logbook loans. So, what should you know about logbook loans and how they can benefit you? Let’s find out.
The basics of logbook loans
Logbook loans can be given by High Street financial institutions, but they are now widely available through the Internet as well. This is essentially a loan you can get by securing your vehicle against the loan, and with this, you can normally receive anything between £500 and £50,000, even more depending on the value of your vehicle. The reason why it’s called a ‘logbook loan’ is simple: when you get the loan, you will be asked to surrender the logbook of your vehicle; alternatively, you can also surrender your vehicle’s document of registration. The logbook and the document of registration are proof that you’re the vehicle’s registered or official keeper.
The essentials of taking out logbook loans in England, Northern Ireland, and Wales
A logbook loan is only available in England, Northern Ireland, and Wales. If you are in Scotland, there aren’t any logbook loans. What you will probably get is a conditional sale or a hire purchase agreement.
If you acquire this type of loan, you will have to sign an agreement of credit, and along with this, you will be presented with a bill of sale. The bill of sale signifies that the lender will now be the temporary owner of your vehicle. The good thing about logbook loans is that even if the lender is the temporary owner of your vehicle, you can still use and drive the vehicle provided you meet all the requirements of the loan. Often, you are also responsible for the vehicle’s insurance, taxes, and maintenance at this time.
Under the law, a bill of sale will only be recognised if the lender of the logbook loan makes sure to register it, so it can be catalogued in the High Court. If the bill of sale isn’t registered, the logbook loan lender will have to get approval from the court to have your vehicle repossessed.
How long does it run?
Logbook loans usually run for about 78 weeks, but you can often pay the loan off at an earlier date. Logbook loans have some of the highest APRs for loans, so you have to choose your lender wisely. There are those which are more flexible and charge less interest, such as www.carcashpoint.co.uk, so it pays to do your research so you can avail of the best deal.
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