The present times are testing ones for the economy and the axe is coming down on a lot of people’s finances with the number of unemployed and bankrupt people at an all-time high. This is why the banks have brought down their affinity towards dishing out regular loans to the public owing to the high risk involved with the whole process.
As a result the concept of logbook loans have been gaining momentum and has become the last ditch hope for a number of people who are suffering because of lack of funds. Are you thinking of applying for a logbook loan? Well, there is nothing wrong with it, but you must be aware of these 2 aspects before applying for it:
1. Loan Status On Your Vehicle
What are the securities that the lender has for providing you with a logbook loan? Your vehicle will be your security when you are applying for a logbook loan. The vehicles registration certificate needs to be submitted to the lender as a collateral security for the loan he is providing to you.
There is one catch with this feature. Your vehicle needs to be completely owned by you, as in, you must have cleared all the auto loan instalments that you had taken out to purchase your vehicle in the first place. Some of the logbook loan lenders also accept vehicles that are nearing their period when it will be free from the auto loan. In case you are long overdue on your auto loan or have just taken out one, the chances of getting a logbook loan against it are almost zero.
2. High Interest Rates
The main criticism that the concept of logbook loans suffer from is the fact that it charges a high interest rate from the people who are availing it. The lenders of logbook loans justify this extremely high interest rate to the fact that the logbook loans are disbursed without performing a credit history check on the person who has applied for it. This involves high levels of risk when it comes to incapability of paying back the loan or other similar defaulting.
This is why it is necessary that you search for the right logbook loans lender in order to ensure that you are getting a safe deal and the best one that can be offered to someone in your situation. If you think you can qualify through the above mentioned criteria, you can click here to start searching for a viable logbook loans lender.