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Advantages and Pitfalls of Logbook Loans

Logbook loans are very similar to secured homeowner loans, as they are both based on a property owned by the borrower. In the case of a homeowner loan, this is the borrower's home, while with a logbook loan, it will be the borrower's vehicle or, more precisely, the logbook document. Both of these loan types put the borrower at risk of losing his or her property in case they are not able to keep up with already agreed repayment terms.

Using a logbook loan, you can borrow up to 75% of the vehicle's value. This means that the lending company can grant you up to 50,000 if they estimate your vehicle's value as high as that. The minimum amount extended is 500.

In order for someone to be qualified for a logbook loan, that person has to be a resident of United Kingdom, 18 or more years older, to have a regular income, and to be the legal owner of the vehicle they want to put against the loan.

The application for this loan basically has two parts. First, you need to either complete an application form on the lender's website or to call them by telephone. Once the loan company receives the application, they call or email the applicant to arrange the vehicle's inspection and view its logbook. This is when the value of the vehicle will be estimated in order to resolve how much you can borrow. They will than make you an offer and if you wish to proceed further, you will need to show them some proof of income. Finally, once that part is done as well, all it's left is to sign the arrangement and leave the logbook document with the lender.


When it comes to logbook loans, your credit rating and history are pretty much irrelevant as there is no credit check involve. This puts them in a very high position as a financing option if you have bad credit.

Also, since repayment terms can be stretched over a longer period of time, these loans can also be used by someone who is self-employed.

Finally, using a logbook loan, the money will be deposited on your bank account in less than 24 hours and it also takes only an hour or often less in order to get approved.


The main cause of concern about logbook loans is that there is always a possibility that the lender will seize your vehicle and resell it if you are unable to repay the loan on time. This can be done without a previous court order, and some lenders also don't warn their customers before doing this.

Also, logbook loans include a very high interest rate, compared standard loans. Usually, these can reach up to 400%.

Is a logbook loan a good financing option if you need some quick cash and you have bad credit? It certainly appears to be, but it is also something with which you need to be very careful and to know all the facts.