Over the past few years, we have seen a significant rise in the number of people taking out loans, as well as the number of various lending options that are available. This is a reflection of the financial struggle a lot of people are unfortunately experiencing in the UK.
One unexpected expense can cause big problems for many individuals and business owners. Late payments are also a real problem. However, with a logbook loan, you have a potential solution to help you with any monetary issues you may be experiencing. If you need some extra cash at your business, this is an option to consider. Keeping that in mind, read on to discover everything you need to know about this type of loan…
Logbook loans are a type of secured loan. This is a loan that will be secured against your corporate vehicle. It is a short term lending option, typically lasting between six months and two years. It’s recommended to use expertto ensure this is financially viable. Most lenders will give you the option of borrowing up to 70 percent of your car’s current worth.
Nevertheless, you do not need to borrow the full 70 percent. There are many different lenders offering this type of loan, and thus you should be able to find repayment terms to suit your situation. Most lenders operate on a monthly repayment scheme and there are even those who offer a period of grace i.e. you don’t have to pay anything back for six months.
So, how does a logbook loan work? The lender will first need to determine the value of your business vehicle. They will do this by using Glass’s Guide. If you are happy with the repayment terms and everything else in the contract, you will then begin the lending process.
You will have full access to your vehicle. A lender should never take your car unless you fail to meet the repayment terms you have agreed to. The only thing you need to hand over is your V5 logbook – hence the name ‘logbook loans’.
When it comes to the technicalities of this type of loan, you are essentially signing a bill of sale. This bill of sale is registered with the High Court and it grants the lender impermanent ownership of your vehicle until you have finished making the repayments. You are basically stating that the lender can keep your vehicle if you do not pay back the loan.
This is why you need to carefully assess every word of the terms and conditions in your contract before agreeing to it. You don’t want to find yourself in a situation whereby you cannot make the repayments and thus you lose your vehicle.
On a final note, one of the reasons why a logbook loan is a popular lending option is because it is open to a wide scope of people. In general, you will need to be over 18 years’ of age and you have to own the vehicle in question. This car must be paid for in full and you need to show that you are capable of making the repayments, i.e. through providing income slips. If you meet these criteria, you should be able to find a lender who is willing to approve you for a logbook loan.