Emphasis on having a good credit score have indeed narrowed down options for UK citizens seeking to have a loan whilst having a poor credit rating. With the global credit crunch that hit the world a few years back, financial institutions and lenders have tightened the noose and are now stricter when it comes to approval of loans. The resultant effect is that UK citizens have seen their loan applications declined than they could care to count. Getting approved for a loan from a high street bank has become more difficult than ever.
It’s perhaps for this reason that the introduction of logbook loans into the UK market was wholeheartedly embraced with two hands especially among UK individuals that had bad credit. Logbook loans are essentially a secured form of loan where ones car is used as collateral. Unlike other types of loans, logbook loans are designed for individuals with a poor credit rating. It doesn’t matter how bad your credit score is or how many times you’ve defaulted in your loans in the past. So long as you are a UK citizen, 18 years of age and above and legally own a car registered in your name, you are eligible to apply for a loan. The requirements are that basic and simple.
Do you need to supply your lender with additional documents?
Yes. In addition to the above mentioned requirements, there are a number of details or documents that you need to furnish your lender to fast track your logbook loan application. These are:
- Ministry of Transport (MOT) certificate
- Insurance and tax details for your car
- Bank statements
- Provide proof that you receive regular income
- Provide proof of where you reside (address)
What kind of car is required as collateral?
Basically, UK logbook loan lenders generally accept all types of cars as collateral. However, there is an exception. The car you bring forth as security should be in good condition and this is why you are required to provide the lender with a MOT certificate. Secondly, the car should not have any form of financing attached to it. If your car meets these two conditions, you can use it as collateral irrespective of the brand or model.
How long does it take before you can receive the logbook loan amount?
Basically, most UK lenders will tell you that the time you have to wait before you receive the cash is dependent on you. If you furnish the lender with all the required details and documentation, you can have your loan processed within hours. However, if you don’t do that, the period might be slightly longer than 24 hours. The onus is therefore on you to ensure that your lender has everything they need to facilitate the loan in the fastest time possible.
To apply for a Simple Logbook Loan, all you need to do is locate a lender you are comfortable doing business with. With so many lenders to choose from, it is highly recommended that you do proper research, do comparisons, read reviews, read past customer testimonials, take into consideration APR and make an informed decision!