It has been brought to our attention, that recently there have been an increase in applications for UK residents wanting a logbook loan.
The majority of these applications have been submitted over the internet, with increasing numbers of individuals wanting to get their hands on quick cash, but they want to do so in the light of the fact they have a poor credit rating, which can often make loan applications more difficult to complete and pay out.
Logbook loans cater for people with a bad credit rating, however there are certain pre-requisite’s to having a logbook loan, these include:
The vehicle must be less than 10 years of age
There can be no outstanding finance attached to the vehicle
The vehicles’ value, (in most cases) must be 125% of the loan value that you wish to borrow.
This criteria is important due to the fact that logbook finance companies must also manage associated risk of borrowing, due to the fact that this would be a secured loan against a vehicle, and vehicles (in many cases) are depreciating assets due to wear and tear, so it is important to the lender that certain security factors’ are built into the agreement in order to ensure that the loan agreement is robust, and beneficial to all parties’ involved.
The activity in this market is set to increase, with the amount of UK residents applying for sub-prime bad credit loans being at an all time high, with no sign of peaking.
Another supposed reason for the increase in activity is the relatively broad acceptance criteria for these loans, as opposed to more conventional personal loans which require a good credit rating & proof of income, along with details about monthly outgoings etc…
The APR rate on a logbook loan is high in comparison to more conventional loans, but it is representative of acceptable risk criteria which the lenders will agree to in order to provide loans to the public, however the APR is much lower than with smaller cash advances as the loan is secured against a vehicle, making the loan much more viable for the lenders and much more available available to the general public.
The demand on the internet for sub prime loans in general is huge, and continues to grow, with the acceptance criteria from the banks’ being at an all time high, this shows no signs of changing in the near future.
It is advised that you check the details around the repayments and the repayment term before you take out any finance, check that this is affordable to you before you set an agreement in place.
Source: Logbook Loans Place