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When you’re really running low on cash and you can’t go to the bank to borrow money, one has to be creative and find alternative means to get it. If you’ve tried the cash advance and it did not work for you, you can try getting logbook loans in the UK, instead. This is a different product from getting guaranteed payday loans for bad credit, and it isn’t the same as borrowing against your salary.

To put it simply, it is cash that you can borrow based on the value of your car. It’s like collateral but moved a couple of steps further because the lender will actually own your vehicle for the period of time that you’ve borrowed sum.

You don’t have to turn over the actual vehicle though, and you can keep using your car or van for as long as you pay the amount back. When you aren’t able to pony up the cash, that’s when the real problems arise.

Do you have a car? You can borrow cash quickly and easily. Borrowers can get as much as £500 and £50,000, depending on the value of the car owned. Technically, one is only allowed to borrow up to 50 percent of the vehicle’s value.

It’s called logbook because the borrower is asked to hand over the car’s registration document, or vehicle logbook. Since these documents prove ownership of the vehicle, not having them means you don’t own the car anymore.

Logbook Loan Eligibility


In order for you to qualify for a logbook loan, a borrower must be:

  • A UK resident
  • Over the age of 18
  • Be able to demonstrate that you can afford to meet repayments
  • Own a vehicle which is free (or nearly free) of finance
  • Your vehicle should be is taxed, MOT’d and insured
  • Supply relevant documentation

Other Requirements for Logbook Lending

In other areas, such as England, Wales or Northern Ireland, people who avail of these are also asked to sign a “bill of sale”. This is a form of credit agreement that means the company holds ownership of your vehicle. Again, you will still be able to use the car to provide that you meet all of your payment schedules. The company then registers this document with the High Court in order to make it legally binding. Think of it as a notary public for similar documents. Bills of sale, however, are not used in Scotland.

With the “bill of sale”, the lender can repossess your vehicle should you default on your payments.

How Does it Work?



These online installment loans near me are traditionally paid by check, and the borrower will need to wait several days to clear. However, times have changed and even these kinds of monetary products now feature quick cash service. The only catch though is that there is an extra 4% fee for this, but we all know that people who need money in a hurry would say yes to this kind of thing. Since you have basically put your car up as collateral, it also follows that the term is a lot longer than others.

These short term bad credit loan applications can have a term of as long as 78 weeks, but the borrower of course has the option to need an emergency loan and pay earlier in order to get his car’s documents back a lot faster. There are also more flexible arrangements, such as just paying monthly interest and repay the entire amount borrowed at the end of the term. This is good for people who are expecting to receive large sums at a certain point in time. Just be sure though that this money arrives on time so you don’t end up losing your car to the lender.

All in all, this financial product charges around 400 percent APR or higher. Interest is also computed each week. These are the same types of deals you would find from companies like cash converters. Here’s how it looks like: Borrow £1,500 and pay £55 a week for a period of 78 weeks and you would have shelled out over £4,250 in total.

Interest is £2,750 for the £1,500 borrowed. You decide whether you need the money bad enough to pay these kinds of interest rates.


How Do Logbook Loans Work?

Logbook loans you can find on the high street and also on the web.

You can usually take such loan for £500 and the highest limit is £50,000. It will vary on the worth of your vehicle actually. There are companies that will only lend you 50% of the vehicle’s price. When you apply for a logbook loan, giving the lender the vehicle registration document or logbook will be necessary.

As a matter of fact, these are documents that prove you own the vehicle and no one else! In any case, you are actually handing over ownership of that vehicle to the lender until the repayment is done.

What You Need to Consider Before Opting For A Logbook Loan

  • APR of such loans tend to be steep and so the sooner you pay it offer, the better it is.
  • If you repay over £8,000 within a year, there may be early repayment charges.
  • Logbook loan lenders may want weekly payments while a few do not accept Direct Debit.
  • If you feel sceptical about the amount repaid already, ask for a statement of account from the lending entity.
  • The maximum amount that you can borrow is dependent on value of the car. The top lenders ask applicants to get their cars assessed independently.
  • Even if you have bought the vehicle by applying for a loan, you still may be eligible for a logbook loan. However, you will need clearance from existing lender. It is allowed if the outstanding is low and the existing loan is nearing its end.

FAQ about getting a Logbook Loan

It may be possible for you to get a logbook loan even with poor credit. However, the lender will decide your eligibility in such situation. In case your loan applications have been refused elsewhere and you want a logbook loan, we will suggest you evaluate your options. Get unbiased debt advice and then decide.

Logbook loans are generally kept on a specific database known as HPI Index and anyone can check it out prior to buying a car. In fact, the Car dealerships check this index too.

If a car is purchased with logbook loan that does not actually belong to the ‘owner’ before he clears the final payment. It is not legal if you try to sell such a car before repayment is over. If the car is sold off before the existing logbook loan is repaid in full, the loan provider may:

  • File lawsuit against the seller
  • Repossess the car from its new owner, even without court order

If you have purchased a vehicle from someone who still owes money taken from a logbook loan, you may also take legal action against him/her and try for refund.

Most logbook loans usually have tenure of 78 weeks, but it is legal to clear the loan before that deadline. It is up to the borrower. With some agreements, you have to pay back the interest charges till the final contract month. In the last month, you have to clear the actual borrowed amount.

You should ensure the loan agreement is well understood by you. Ensure you are capable of paying it back too.