If you are considering applying for a this type of loan, it would be advisable to compare logbook loans. The term logbook is familiar to residents of the United Kingdom, but it may be a new concept to others. Basically a logbook loan is a secured loan where the borrower relinquishes the logbook of his vehicle in exchange for cash that is a short term loan. The advantage to the borrower is that he can keep his car and get the cash. This advantage does come at a price. If you have a bankruptcy or other undesirable credit history and are not able to get credit, a logbook loan may be the answer to your problem.

The term logbook is mostly unknown in the Untied States of America. Logbook originally referred to a ship’s log where the time and distance traveled by the ship would be logged into a book. As often happens, the meaning of logbook has been expanded to include reference to a vehicle’s registration certificate. A car owner will only gain possession of the vehicle’s logbook when he has fully paid for the car and there is no financing or other lien attached.

Logbook is a colloquial term for a vehicle’s registration certificate in the United Kingdom and in Ireland and Australia. With a logbook loan the borrower receives a cash loan from the lender, but the lender takes possession of the logbook until the loan has been repaid. The car serves as collateral for the lender. If the borrower defaults, the lender has the legal right to take possession of the car.

There are many sources for consumers to obtain a logbook loan. For this discussion lenders Mobile Money and V5 Loans will be compared. Regarding locations and branches, Mobile Money has several, more than thirty, branches in the United Kingdom. The Website states that borrowers must reside in England or Wales. V5 Loans have many branches in the UK, but also have locations in Scotland and Northern Ireland. If residency is required by V5 Loans, this is relevant information.

The interest rate charged is a point of consideration. Mobile Money’s rate is slightly higher than V5 Loans‘ rate, 385.2 percent versus 378.3 percent. The two competitors also differ in the duration of time to repay the loan. Mobile Money has a maximum loan life of six months compared to the V5 Loan maximum of twelve months. Borrowers will need to weigh the cost of the additional interest paid against their ability to repay the loan in the time allotted.

The person applying for a logbook loan will likely have a temporary cash flow problem. Coupled with an inability to get credit and an immediate need for cash is what creates the financial need. Hopefully, the impetus for acquiring the loan is of a temporary nature. If the cause in ongoing, the borrower may be unable to repay the loan.

Typically lenders will not loan one hundred percent of the car’s value. V5 Loans‘ Website states that the company will loan up to seventy-five percent of the car’s value. Money Mobile’s Website does not state the percentage of value it will loan. The amount to be loaned may be dependent on several things, such as the car’s mileage, condition and age. Both V5 Loans and Mobile Money have a maximum loan policy of 25,000 pounds. If the borrower needs more cash, other lenders may offer a higher maximum but it will be at a higher rate of interest.

Borrowers are attracted to logbook loans because they can get the cash immediately. The approval process is very quick and not dependent on a credit report. Compare logbook loans to make sure you are making the best choice for your situation. Logbook loan borrowers will pay significant interest but can still minimize the loan’s cost by comparing various competitors.

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