What are logbook loans? Will I qualify? Is my car suitable?
You can get the answers to all of these questions and more here…
What is a Logbook Loan?
Logbook loans are a method of borrowing money that use your car or vehicle as security. Using your car as security against your loan means that you can get a better interest rate compared to some other forms of credit.
You keep driving your car while you repay the loan, the lender just keeps hold of the car’s logbook. The loan is secured against your car using a document called a “Bill of Sale”. For full details about “Bill of Sale” documents click here
The amount you can borrow depends on the trade value of your car – the more that your car is worth, the more you can borrow against it. The amount you can borrow also depends on how much you can afford to repay each month.
Will I Qualify for a Loan?
To apply for a logbook loan you must:
…live in England or Wales.
…be aged 18 years or above.
…own the car and be the “Registered Keeper” on the logbook.
Are There Any Hidden Fees?
There are NO hidden fees or penalties.
It’s that simple.
Will My Car be Suitable?
To be used as security your car must:
…be worth at least £700
…be free (or almost free) of finance.
…be taxed (not on a SORN notice), MOT’d and insured.
How does a logbook loan work?
The most important thing to know is that a logbook loan works by using your car, van or motorbike as security. This means that if you fail to repay the loan, the lender can repossess your vehicle and use the money from the sale to pay off the loan. However, it is important to know that if the vehicle does not sell for enough money to cover the outstanding debt, you may still owe the remaining balance.
It’s not like “pawning” something – you do not have to give up your vehicle to take out a logbook loan: you keep hold of the vehicle whilst you make your repayments so you can drive, run and maintain it as usual. With loans written by Mobile Money, a vehicle would only ever be repossessed if the borrower stopped making repayments altogether and failed to contact us to make alternate arrangements.
Will my car be suitable?
Your car / vehicle must have a high enough “trade value” (the amount of money you would get if you part-exchanged your car at a garage) to cover the value of the loan. In general, the more your car is worth the more money you can borrow. Any vehicle you are thinking of using as security must be in a reasonable condition and road-worthy.
You must be named as the owner on your car’s V5 registration document and your vehicle must be insured, have a valid MOT and it must be taxed – vehicles on “SORN” cannot be used as security. To make life easy we will confirm these things online before approving your loan so won’t need to send us any documents!
Will I get a logbook loan?
To get a logbook loan you must be at least 18 years old, live in England or Wales, and be able to afford the monthly loan repayments – all good lenders will make sure that the repayments are affordable before they provide you with a loan.
You can get a logbook loan if you have a poor credit history, but you cannot get a logbook loan if you are currently in a debt management plan, have a live IVA or you have been declared bankrupt.
Logbook loans for cars on finance
Getting logbook loans for cars on finance can be tricky, but it is not impossible. In general, any vehicle being used as security for a logbook loan must be free from finance although it may still be possible to use the car / vehicle if there is a small amount of finance left on it. In order to do so, the amount of outstanding finance would need to be added to the amount of the logbook loan, then the additional funds are used to pay off the remaining finance. We recommend avoiding doing this as the interest rates are normally higher than those of the outstanding finance, so paying it off with the logbook loan is usually more expensive for you.