Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk.
Representative Example: Amount of credit: £300 for 74 days with one repayment of £88.80 and one repayment of £388.80. Interest: £177.60. Interest rate: 292% pa (fixed). 1295.5% APR Representative.
What Are Logbook Loans?
As a short-term loan that is secured against a vehicle, a logbook loan requires the individual to hand over the vehicle's logbook (or V5C vehicle registration certificate, which proves you are the registered owner) and temporary ownership to the lender.
You can normally borrow anywhere between £500 and £50,000, depending on how much your vehicle is worth, but bear in mind the loan amount will usually be based around 60 per cent of your vehicle's trade value.
The loan generally runs for several months, and in the UK, you enter into an agreement stating your repayment plan and agree to use your vehicle as collateral for the loan – you can use the vehicle so long as you meet all repayments.
In short, car logbook loans provide a way to get emergency funding, and once signed into one, you will still be able drive your vehicle, but if you don't make the payments, you can lose your car.
Disadvantages of a Logbook Loan
The major disadvantage of a logbook a loan is that if you fail to make payments, you can lose ownership of your car. You can lose your car because the vehicle is used to "secure" the loan. If you are considering a logbook loan, you may want to also review some unsecured loan products that don't require collateral. Keep in mind that unsecured products may have additional drawbacks that you need to carefully consider.
The Right Short-Term Loan for You
As with loans offered by QuickQuid, logbook loans are often sought by consumers as a last resort, and won't be right for everyone. At QuickQuid, we offer unsecured loans for life's unexpected emergencies which don't require collateral.
QuickQuid offers new customers loan amounts of up to £1,000 if approved. We are a responsible lender that provides a temporary solution for those unexpected moments when you find yourself needing funds until your next payday.