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Unmasking the concept of Logbook loans

The concept of logbook loans has now taken root in the UK market as compared to when they were first introduced. At the time, there were doubts as to whether this model would work especially with the promise that credit checks were not a deciding factor. However, the spiralling popularity of logbook loans has indeed put the naysayers to shame. Those who held the view that V5 loans would be a thing of the past within a couple of months had to eat humble pie.

What is a logbook loan?

Otherwise known as a V5 loan, a logbook loan is essentially a special type of secured loan where a person’s V5 document is used as security for the loan. In essence, what typically happens is that the borrower signs off their car to the lender for the duration of the loan. The car becomes the property of the lender for the whole duration of the loan until the amount due is fully repaid. However, the physical possession of the car remains with the borrower who can use it as they repay the loan. What the borrower surrenders to the lender is the car logbook.

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Requirements to be eligible for a logbook loan

As is with any other loan instruments, UK logbook loan lenders require applicants to meet certain qualifications as well as submit certain documents before they can be considered for a V5 loan. The first on the list is the requirement to be a citizen of the United Kingdom. You need to show proof that you reside in the UK, proof that you are not a minor (must be 18 years and above) and show proof that you are in employment (copies of payslips or bank statements would suffice).

That is not all, you need to furnish the lender with a copy of your identity card, a ministry of transport (MOT) certificate, and proof that your car is fully insured not forgetting the car tax details. The car you set up as security should be one that you legally own. What this specifically means is that you cannot produce as security a car that belongs to your neighbour, your friend, colleagues at work, cousin or even a sibling.

Do you have to worry about credit checks?

For a long time, credit checks have stood in the way of individuals seeking to get a loan. Well, logbook loans made that a thing of the past and it is no wonder they are popular with individuals whose credit rating has taken a nosedive. So no, you don’t have to worry about credit checks when applying for a logbook loan.

Instances when you could be denied a logbook loan

While it is a foregone conclusion that your credit score plays no role in the decision to reject or approve your application, there are instances when UK logbook loan lenders might not consider or out rightly reject your application. The most obvious reason is of course not meeting the requirements set forth. Secondly, wilful submission of wrongful information is fertile ground for rejection. Thirdly, a car that has been on the road for a period longer than 10 years will not be accepted as collateral and therefore, will lead to rejection of your application. On the same note, a car that is not serviced regularly or is simply unroadworthy would not be accepted as security and lead to your application being thrown out.

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As you will found out right here, logbook loan applications are open to everyone and all you need to do is ensure you choose the right lender in the UK. You can indeed get the money you need within a couple of hours using your car as security without worrying about your credit rating status.

 

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How to avoid being swindled when applying for same day loans

Given the huge number of desperate people in need of same day loans, there are a number of shrewd lenders that have taken the opportunity to swindle unsuspecting borrowers of their hard earned money. These lenders essentially pose as genuine lenders but all they are out to do is simply milk you to your last coin. With thousands of same day loan lenders on the internet claiming to offer the best rates in town, it might be difficult to identify a genuine lender to do business with. In light of this, how do you avoid being conned when applying for same day loans?

Research! Research! Research!

There is no other way around it. If you want to get legitimate same day loans from legitimate lenders, it is essential that you take the time to do some research prior to doing business with a given lender. Take your time to visit comparison sites and shortlist the most reliable lenders before making an application.

Read reviews

The best way to ascertain the reputation of a given same day loan lender online is by reading reviews left by past customers. Positive reviews are an indication that a given a lender ascribes to the highest levels of ethical conduct while negative reviews should raise a red flag. Reviews enable you to have a glimpse of how a given lender generally interacts with customers, how the complaint resolution system works and so on and so forth. It actually helps you make an informed decision especially if you are a greenhorn in matters of same day loans.

Ask for recommendations

If you have never applied for same day loans before, chances are that a friend, a colleague or even a family member has. Unsure as to where to start or how to go about it? Why not seek a recommendation? Friends or colleagues who have applied for same day loans before can point you in the right direction or even assist you from making a serious mistake. It is always good to get a second opinion before taking a plunge.

Check with licensing authorities

Always determine whether a given lender is properly licensed and working under a professional body or not. Licensed lenders tend to operate within set out rules and regulations and are professional in every aspect. They do not unilaterally set and change interest rates and neither are they keen on swindling customers.

All the above measures will without a doubt be instrumental in helping you make an informed decision when applying for same day loans.

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Mistakes many people make when applying for same day loans

Same day loans, just like any other type of short-term loan, can be risky especially if you bury your head in the sand. Desperate or not, it is highly advisable that you put your best foot forward and avoid traps that might make your loan experience a nightmare. While same day loans continue to rise in popularity not only in the UK but also other parts of the world, a couple of mistakes could essentially make your experience with them one that you would like erased from your memory soonest.

The keyword when taking out a same day loan is “responsibility”. You need to borrow responsibly and exercise financial prudence with the money advanced to you by lenders. So what are some of the mistakes most people make when applying for same day loans?

Borrowing a same day loan for the purpose of paying off a previous loan

If you have an existing same day loan and have encountered problems repaying it, you should never apply for another same day loan for the purposes of clearing the earlier loan. By so doing, you will simply be entering into a vicious debt cycle that could see you filing for bankruptcy in the foreseeable future. Same day loans attract high-interest rates and the fact that you are unable to pay the current loan means that you will be putting yourself in deeper trouble by adding more debt.

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Borrowing more than you need

The allure of quick cash might cloud your judgement and you might find yourself borrowing more than you actually need. However, considering the interest rates of same day loans, it is advisable that you apply for what you need. This is simply to make it easy for you to repay your loan without any difficulties or adding further strains to your finances.

Not researching prior to taking a loan

What would you do if you realised that the loan you’ve just taken is offered at a lower interest rate elsewhere? Of course, you will feel bad or in some way exploited. It is important you carry out due diligence prior to taking out a loan for the purposes of ensuring that you get the best competitive rates in the market. By making comparisons, you will be able to find yourself a good lender with better interest rates than you would if you applied for the same haphazardly.

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Not preparing a repayment budget in advance

Before you apply for a same day loan, ensure that you have a repayment budget. Your income should be sufficient enough to comfortably repay your loan without putting constraints on yourself. One of the major reasons people enter into debt is because they take out a loan without taking their ability to repay the same into consideration.

Important things to keep in mind when seeking to apply for same day loans

Granted, a loan is a very important financial commitment to be taken out in a rush. It’s a commitment with serious ramifications should you find yourself in a quandary and that is why it is highly recommended that you take your time and do research before you take the plunge. It’s true that you might feel as if your financial circumstances have put you into a mechanical mode of reaction, impossible to resist and thereby prompting you to make irrational decisions. However, when you take into consideration the risks of poor financial decisions, you should take a moment to ponder prior to applying for a same day loan or any other kind of loan facility for that matter.

Same day loans have enjoyed immense popularity in the UK from the very first time they broke onto the scene. They gave a new meaning to the whole process of loan application and approval not to mention the fact that UK individuals suffering from bad credit finally had their big break. Small financial emergencies were adequately taken care of in a couple of hours thanks to same day loans. In other words, same day loans made it possible for people to apply for a loan, get approved and receive the cash they need within the same day they made an application.

With that said, applying for a same day loan is not all about waking up one morning and doing business with any UK lender you stumble upon. It is about making prudent financial decisions and a lot of research and consultation goes into it. In light of this, what are some of the important things one needs to keep in mind when applying for same day loans?

Cost comparisons

There is no one interest rate for all applicants and for this reason it’s essential that you take your time to compare costs from different UK lenders. Take your time to understand how taking a same day loan will affect your finances. Understand what the full cost of the loan you are taking is and ensure that you settle for a lender that adequately meets your needs.

Understand the requirements fully

You definitely do not want to apply for a same day loan and ultimately get rejected because you were ignorant of the eligibility requirements. Find out if you are eligible and prepare the documents needed so as for the whole process to go smoothly without any glitches.

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Read the fine print

Do not believe every word that comes from the lender’s mouth. In any case, they are out to make money and are bound to use every trick in the book to bring you on board. Mind you, the devil is always in the details. Most unscrupulous lenders tend to put a number of unfavourable clauses or hidden fees in the fine print because most borrowers are hasty to sign on the dotted line without reading it. Take time to read the fine print and only sign if you agree with everything.

Have an understanding of the repayment terms before you take out a same day loan

Loan repayment will without a doubt affect your finances and it is therefore highly recommended that you fully understand the repayment terms before applying. Is the repayment of the loan you are about to take flexible or does it simply box you into a corner? It is important that you take out a loan that you will be able to repay comfortably without getting deeper into debt.