Logbook loans are those loans which are provided by securing a debtor's vehicle. The structure of the loan means that a lender could repossess debtor's vehicle without any court interference. In other words your vehicle or car acts as collateral against which a loan is sought. The loan is also known as the Bill of Sale loan. A bill of sale has been defined as a legal document made by the seller to a purchaser, reporting that on a specific date at a specific locality and for a particular sum of money or other value received, the seller sold to the purchaser a specific item of personal property (vehicle i.e. car), or parcel of real property of which he had lawful possession. The Logbook also contains all the details of your vehicle i.e. Engine number, color, registration number etc. Like any other loans you need to serve certain eligibility criteria which are:
- You must be 18 or above
- You must own a valid bank account
- There should be no liability against your collateral i.e. car
- The vehicle should be in good condition and in no case more than 8 years old
Once these conditions are fulfilled your loan is sanctioned once. The benefit of popularity of this loan is due to the fact that it is taken against a security and hence you need to pay the lower rate of interest. Failure of repayment of loan will lead to the repossession of your vehicle by the lending institution that may or may not sell your vehicle to someone else. The borrower could apply for such loans via internet. These loans are sanctioned very fast. Logbook loans are short term loans taken against collateral for which repayment may be extended according to borrowers need. The reason why these loans are sanctioned fast is because of the fact that the loan is already secured and hence no credit check is important for a lending institution. One should strictly avoid log book loan if you do not have a constant income source. It is better to sell your collateral then giving it away on a small part of loan.
Addy Roy is an author of Loans n Finance. For more information about Self employed loans and Cash Loans for Bad Credit visit www.loansnfinance.co.uk
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