Using the Logbook Loan as a Stepping Stone to Financial Freedom

When you find yourself in the corridors of logbook loan dealers, the chances are that your finances are in big trouble. In many cases, people turn to logbook loans because they have a poor credit score and no bank wants to lend them. They are high-risk clients. However, logbook loans have recently been tagged the “ultimate point before total failure.”

In the UK, more than 50% of people who go for logbook loans end up defaulting. In many cases, the borrowers rarely see all the risks involved. It comes as a surprise to realize that the monthly repayment burden is too much. If you default for a couple of months, the already high-interest rate attracts even more penalties, and everything blows out of proportion. However, things do not always have to go this way.

Financial experts are now pointing that you only need a little effort and the logbook loan will cease to be a threat and turn into a great blessing. That is right; a stepping stone to success. Here is how to use the logbook loan to march to success.

Use the huge debt burden to reorganize personal finances

Your huge debt burden should trigger an instant reflex in personal lifestyle. Now that you cannot access credit from banks or other financial institutions, ensure to redefine personal finances. Look for alternative avenues to raise cash for loan clearance and personal success. Take an example of a fitness expert with a local company. Such a person can start a blog to help people with weight loss, fitness management, or even work on a part-time basis. Though such efforts might only generate limited revenue, it will go a long way in helping to clear the outstanding loan.

Create a perfect plan for getting out of debt and beyond

One thing you must get right when trying to clear a logbook loan and rush to financial freedom is that results can only be possible with a good plan. This means looking at the entire personal finances from a longer and broader perspective. A good plan should ensure that you are servicing the logbook loan on time without forgetting the other obligations. It should also include an emergency kit so that more issues that emerge on the way do not compromise the ability to clear the loan.

Focus on austerity in your lifestyle

To succeed in addressing your financial woes, you must focus on austerity. Though you might not realize it right away, the truth is that there are many areas where you can adjust, make huge savings, and direct the funds to clear the logbook loans. Here are some great examples.

  • Consider carrying packed food as opposed to going to the café every day.
  • Use public means to go to work a few days of the week as opposed to the family car.
  • Purpose to go for holiday twice as opposed to five every year.
  • Change your diet to feature cheaper and more nutritious options.

The final take

The logbook loan you took should not be your source of tribulations. You only need to appreciate that it will not be easy and make some adjustments. Make sure to also focus on austerity, draw a good plan, and keep improving the credit score. Remember that patience is of essence.

 

Unravelling the Pros and Cons of Logbook Loans

Are you struggling to get a loan because of your poor credit? Do you need cash to take care of an emergency? The logbook loan might just be perfect for you. While it is easy to secure a logbook loan, it is important to consider the pros and cons before making that final decision.

The advantages of logbook loans

There are several merits here. First is the availability. There are many loan service providers that offer logbook loans all around the country, with some even offering the service online. This means one does not necessarily have to visit the physical office. Furthermore, they are typically processed very fast and are ideal for the individual needing quick cash. This is what makes them particularly attractive to the individuals with poor credit. Some loan providers even offer same day approval.

No credit checks

This is perhaps the biggest advantage; there are no credit checks for logbook loans. Poor credit can happen to anyone and can be because of defaulted or missed payments.  As long as you have a vehicle that can be used as collateral, then you will get your logbook loan very fast.

Large loans

With your car offered as collateral, you will have the opportunity with a logbook loan to borrow larger amounts than your typical unsecured loan. Amounts borrowed range from £500 to £50,000, with repayment periods of between 12 and 36 months. The rule of thumb for most borrowers is half the value of the vehicle, but some can go as far as 70 percent of the vehicle’s value.

Disadvantages

High APR

Logbook loans involve a high level of risk for the lender, and this is why they often have high interest rates. The average Annual Percentage Rate (APR) of the logbook loan is 400 percent, which will cover the interest, processing fees and other related charges in an annual basis. For the borrower, the reprieve is that competition has forced some of these rates down to an APR of about 200 percent.

Possibility of car repossession

Another disadvantage one must be aware of going in is the possibility of repossession. Logbook loans are secured by the vehicle, and there is always the possibility of losing the vehicle should one default. However, with a good lender, you will have the opportunity to make alternate arrangements, provided communication is given as early as possible. Repossession normally only happens if after several attempts at an alternative payment system, one still cannot pay.

Before going for a logbook loan, it is important to therefore shop around with the advantages and disadvantages in mind. Think about your situation and only go for the lender that has the best terms. Treat the loan process just like any other shopping process and compare the various deals before making a decision. Remember, every service provider will present themselves as the best; be very wary and make sure to look at the fine print of the deal. Further, it helps to be more familiar with such terminology as the APR, hidden fees and interest rates. With this information, the process of getting a logbook loan will be very smooth.

Types of Loans: Finding the Perfect Loan for Your Circumstances

Most people have been there: needing money urgently but not really having enough in handy. This is where loans come in and help. There are many types of loans available in the market today, but the choice of loan should be dependent on one’s situation and circumstances. Are you looking for a loan? Here are some examples of options you might opt for.

The unsecured loan

This is basically a personal loan which is not connected to one’s assets. The loan is issued based on the credit profile of the borrower and the economic circumstances, and not necessarily what they can offer as collateral. Most of the time, they are offered for lengths ranging from 1 to 7 years, with borrowing levels of up to £25,000. This number can be significantly less for some borrowers.

The implications of taking out this loan is that default is not punished by loss or repossession of any asset, unless it is part of a larger financial arrangement that specified some sort of personal liability. The opposite of this is the secured loan, which is tied to an asset like a house, property or vehicle. If one defaults then the lender repossesses the property that has been put up as collateral to recover their debt. Because of the security component, secured loans typically offer higher limits than unsecured ones. They are also normally cheaper than the secured ones.

Payday loan

A payday loan is more of a stopgap measure, a short term loan option that fills a gap before regular payment comes. The typical payday loan is often expected to be paid back within a period of one and 30 days. They normally involve small amounts, between £25 and £1,500, smaller than is normally offered by other lenders or loan types. Due to their short term nature, they might also be referred to as same day loans, instant loans or fast cash loans. They also carry much higher interest rates than other comparable loan types.

Logbook loans

The logbook loan is technically a secured loan, but one where the borrower puts up their vehicle as collateral. The lender will then take ownership of the vehicle until the debt is paid. However, while the lender essentially has ownership of the vehicle, it is ‘lent’ to the borrower during the loan period to continue using. The ownership of the vehicle is transferred back to the owner once the debt has been paid. Normally, the logbook allows one to borrow up to a half of the market value of the vehicle.

Still, if the vehicle’s value depreciates during the time of the loan, the borrower will still be liable to meet the shortfall. One particular advantage of logbook loans is that they offer loans to people with poor credit scores who might otherwise be denied loans through the normal channels. Logbook loans should be differentiated from car loans, which are loans given for the purpose of buying cars. Car loans can be given be through banks directly or on hire purchase through dealerships.

Logbook Loans: Loan Borrowing Tips for the Customer

Logbook loans are tricky business. In fact, according to many financial advisors, logbook loans should always be the last resort. They come with a very high annual percentage rates. In the UK, even with some lenders offering lower rates, the average APR can be as high as 400 percent. Whichever way one looks at it, the cost will add up the longer the loan lasts. Still, if you are in a situation where you will need a logbook loan, here are some tips from the experts on how to go about it safely.

Strategize

One of the keys to the safe navigation of such a situation is the appreciation of the depth of the debt problem. Think wider than just the loan itself. For instance, if the reason for the logbook loan option was poor credit, work not only towards the clearing of the loan but also towards the improvement of credit score. Think about completely getting out of debt, rather than just dealing with the car loan. It might help to seek the help of financial consultant.

Credit score

Regardless of the details of the situation, credit score plays an important role. Even with the loan secured, it is likely that the need for money has not and will not end. Think about what happens in case there is need for cash after the logbook loan has been cleared. It is important to keep track of one’s credit score. Regularly check and correct the score from various credit reference bureaus, clear current debts and establish areas of expenditure to reduce.

Additional revenue streams

Even with proper budgeting, without adequate revenue streams resources are almost always limited. There will be new expenses coming up and debts that need to be paid. In order to handle the logbook loan and service it adequately, seek additional revenue streams. The additional revenue stream does not have to be as much as one’s actual salary, but it will go a long way when it comes to the clearance of the loan. For instance, most people work online during their free time for extra income. One could also start a small business or go freelance.

The borrowing process

There are clever tips during the borrowing process that can make things much easier. As a general rule for borrowing or loans, it is advisable to stick only to what one can afford and what they need. Borrow the smallest possible amounts, and choose the shortest realistic time to get out of debt. Another useful tip is to evaluate the lender. Do not only look at the number of years they have been in business as an indicator of the quality of their service. One’s duration in service does not necessarily equal quality. Instead, place greater emphasis on what other customers are saying about them. Ask for customer feedback and if possible talk to a few willing past customers. Finally, always remain committed to monthly payments and schedules; the result of the process is dependent on the customer as much as it is on the company.

 

Getting Out Of Financial Trouble After Taking A Logbook Loan

If you are considering taking a logbook loan, the chances are that you are in a sort of financial trouble. Over 90% of people who go for logbook loans in the UK today are under serious financial distress. In most of the cases, their applications for credit have been declined by conventional lenders because of poor credit score.

At this point, many see like there is no light in the near future. But this is incorrect. A closer look at a significant proportion of those people who are very successful in the UK today will reveal that they had sunk to the bottom of their lives at some point. Therefore, your situation is not unique. Here are some useful tips to help to turn them into stepping stones to success.

Draw a comprehensive plan to clear the logbook loan and other high-risk credits

Debt problem for many people often unfolds rather fast. Some do not even know how it happened. Well, consider that history. What is more important is ensuring that you get out of the problem.

Start by drawing a good debt recovery plan. This means appreciating that there is a problem and committing to counter it. There is no letting go!  A recovery plan will require settling to some basics of budgeting. Factor, your income and ensure that ample resources are dedicated to clearing the logbook loan and other high-risk loans.

Remember that the budgeting should incorporate all the components that are meant to help you keep moving. Make sure that the daily expenses such as rent, food, transport, and other essentials are catered for. Then, direct the remaining funds to clear the logbook loan and other debts.

Make the personal credit score improvement the driving force of everything

One thing you must appreciate is that there is no financial freedom without improving personal credit score. Indeed, it is the main reason you are in the current hole. Therefore, you must place raising credit score the priority in everything you do. How can this be achieved? Though there is no shortcut for it, it will come as a surprise to realize that some methods are indeed very easy to implement.

  • Correct your credit score with credit reference bureaus.
  • Borrow from your account. Since no bank is willing to lend you cash, go ahead and borrow from your account and repay on time to build a good credit history.
  • Make sure to clear all the outstanding loans. Do not ignore clearing even the monthly utility bills on time.
  • Avoid overspending and direct the efforts to clear outstanding credit and building an emergency.

Take to austerity in personal lifestyle

Though it might appear that everything is against you in so many ways, take a closer look and will appreciate a lot of loose ends. For example, instead of taking lunch at the expensive restaurant, consider carrying food from home and directing the savings to clear loans. Other areas of austerity you might find important include;

  • Subscribe to online movies as opposed to going to the expensive theaters every week.
  • Ride to work or take the public transport instead of using the family car.
  • You could even cut the number of holidays to one instead of three and commit savings to growing the saving portfolio.
  • Work towards creating multiple lines of income.

The final take

While taking a logbook loan is no doubt considered the lowest that a person can sink financially, it can also be a turning point. Take a break and look at it differently. Every cloud has a silver lining. Let the logbook loan become the last and the first stepping stone towards your personal, career, financial, family, and holistic success. It has been done, let this be your turn to grow.

 

Two Special Benefits That Make Logbook Loans Very Attractive

Logbook loans are the saving grace for people with very poor credit score. Because of the poor credit score, your loan options are very limited. Most banks will not want anything to do with you because of the risk involved. Even those who agree to lend you will demand collaterals such as a house. The best way out of the problem is getting a logbook loan.

While logbook loans have had very bad publicity because of high-interest rates and associated risks, they come with two unique benefits that make them very attractive.

The best option for damage control

When one is faced with an emergency such as an accident, there is a need for urgent cash to meet the unexpected bills. However, such bills do not only come because of related medical emergencies. You might need urgent cash to cater for marriage, death, handling a new contract that came too soon or even a holiday. Now, with all the lending institutions turning you away at first sight because of poor credit rating, a logbook loan is one of the best options for damage control.

In some cases, people take logbook loans to clear other loans. This allows them to only concentrate on paying a single logbook loan to avoid defaulting. Even if you have poor credit score, do not let the outstanding debts pull you down any longer. You have the option of taking a logbook loan for damage control and reducing the stress of handling multiple loans.

Notably, the logbook loans are more flexible compared to the conventional bank loans because borrowers can negotiate the APR, terms & conditions, as well as the repayment period. Do not simply take the rates offered by lenders; negotiate for better terms.

An opportunity to address long-term credit problem

In addition to the fact that a logbook loan is easily accessible, you will also enjoy long-term credit related benefits. If you have poor credit, accessing credit in the UK is an uphill task. But hold on. One of the solutions for addressing poor credit score is demonstrating commitment and ability to repay on time. Therefore, how is that possible when you do not have access to loans? At this point, you need to work for a reliable solution that can help to address the problem conclusively. This is where logbook loan comes in.

Because logbook loan companies are willing to lend cash to all, they present a unique opportunity to address the credit score problem and march to financial freedom. One, you can clear the existing debts and continue dealing with a single lender. Because credit reference agencies use the outstanding loans as an important factor in calculating the credit score, the score will improve significantly.

Some people also use the logbook loans to increase their streams of revenue. Some use the cash to start side businesses. For example, you could start a baking venture and supply the cakes to neighbourhoods. In other cases, creative people can use the cash to redesign part of their homes to create a rental unit.

The final take

While it is true that the risks involved in logbook loans are many, you can use the credit to redefine personal financial future. Notably, you should be extra careful when selecting lenders by reading reviews, negotiating for better terms, and clearing the loan as fast as possible

The Link between Logbook Loans and Personal Credit Score

If you have a poor credit score, requests for a loan from conventional lenders will be rejected on first sight. You are a great risk and lending any cash to you is considered a great liability. The only place left to get credit is from lenders who do not factor the personal credit score such as logbook loan companies.

While it is true that the main factor that most logbook loan lenders are interested in is the capability to repay, there is a clear link to credit score. In this post, we bring out this link and demonstrate why you should make improving the credit score a priority.

Default can be reported to credit reference bureaus

When people take logbook loans, the likelihood of sinking deeper into financial turmoil is very high. In addition to the common risks such as losing the family car and hefty penalties, the lender can report cases of default to the credit reference bureau. This means that your credit score will become worse.

Because logbook loan companies are legal entities, they can file default reports directly to the credit reference bureau or capture the details in their bank details. In either way, the credit reference bureau will note you and degrade the credit score until the entire loan is cleared.

Logbook loan lenders can assist clients to fix poor credit score

Though your credit score is already poor, the logbook loan dealer can assist to address it. However, many people rarely appreciate this special role of the logbook loan lenders. If you select the logbook loan company carefully, the lender can assist in the following ways;

  • Helping you understand personal credit score and how it works
  • Helping you craft a good financial strategy for clearing loans and marching to financial freedom

Do not simply look at the logbook loan companies as entities out to make the highest possible profits. They also want to create a good image from a clients’ viewpoint. This will make them win more customers. Remember always to engage the lenders early enough before things get out of hand.

Allowing the lender to automatically draw monthly payments can worsen the credit score

One of the methods used by borrowers to prevent forgetting regular monthly loan repayment is allowing the lender to automatically draw from the account. This means that you can stop worrying about the loan because all monthly payments are cleared on time. However, if your salary is late or cash is not enough, the lender can get an overdraft. This will sink you deeper into financial trouble because it is still a form of borrowing.

Logbook loans often make people forget other loans

The risks that come with logbook loans are very many. To avoid them, many people prefer directing as much cash as possible to clear the logbook loan at the expense of other loans. Consequently, the factors that pulled down the credit score remain unattended. This means that by the time the logbook loan is cleared, the credit score will still be poor. Therefore, it will still be impossible to get a loan from the bank. The chances are that you might end up taking another logbook loan.

To sail through a logbook loan effectively and draw more value, it is important to plan appropriately. You need to think about repayment and how to address the damaged poor score. If you find it too much, do not hesitate to seek assistance from a financial expert.

 

4 Things That Land People into Financial Problems after Taking Logbook Loans

A logbook loan is a credit line of last resort. Many people only resort to it after all the other avenues are exhausted. The risks involved in taking a logbook loan often push many borrowers deeper into financial turmoil. Despite these risks being known and highly publicized, a lot of people still find themselves sinking deeper into financial trouble after taking logbook loans. This brings us to the question; what are the main reasons that land people in more trouble after taking logbook loans.

Not picking the right logbook loan lender

The logbook loan lender you pick is the main determinant of the success to anticipate during repayment. If the logbook loan company has a very high-interest rate, you will have a huge repayment burden. But the interest rate is not the only thing to look for when picking a logbook loan company. You should also focus on checking the following things;

  • Check for a lender with good terms and conditions for the loan
  • Only work with the company that does not include unnecessary/hidden charges
  • Select the company that has a good reputation in the UK

 

Drawing a poor credit repayment plan

Once you decide to go for a logbook loan, the greatest mistake one can make is drawing a poor repayment plan. A bad plan will make it difficult to follow with monthly payments and result to defaulting. To draw a good plan, you need to factor the revenue available and focus on clearing all the available debts. If the revenue streams are not enough, you might need to consider areas of austerity in personal lifestyle. Make sure also to factor other personal expenses.

Directing all personal revenue into clearing the loan only

While it is true that some loans such as payday and logbook credits are very risky and require special focus, directing all personal revenue there is a big mistake. Just like an issue arose and forced you to take a logbook loan, there is no guarantee that a new problem will not emerge along the way. Therefore, while the bulk of the revenue should go towards clearing the risky loans, a significant portion should be directed towards creating an emergency fund. If there is no emergency fund, even small issues will force you to get a new logbook loan.

Working on the logbook loan without focusing on improving credit score

The main reason that pushes many UK citizens to borrow from logbook loan dealers is poor credit score. But many are the people who forget about this reality the moment logbook loan cash reaches in their accounts. However, this is very dangerous because you will still be in the same trouble that made you look for logbook book loan.

Once you get a logbook loan, it is important to start crafting a way of raising the credit score. This should start from understanding the causes of poor credit score and starting to address every issue that had lowered the personal score. For example, you need to start building a good credit history, clear the outstanding loans and get the right credit mix.

While the logbook loans have received a very negative publicity, the truth is that you can wade through and emerge a better person financially. Always remember that the key to financial success if good planning. Simply plan well, make some austerity measures, build an emergency fund, and increase the streams of revenue are the initial steps towards financial freedom.

4 Benefits of Making Your Logbook Loan Dealer A close Friend after taking a loan

When you decide to borrow a loan, the lender should be a close friend. If the lender is a conventional bank, the services offered will go beyond the loan. In many cases, the services could be the missing link to help your business march to the next level. However, when the credit score is low, the available loan options are very few. One of these options is the logbook loan.

A logbook loan is a form of credit secured against your car. It is considered the option of last resort because of the multiple risks involved. If you take a logbook loan, it is very important to prepare appropriately. More importantly, you should make the lender your closest friend to enjoy the following benefits.

Easier negotiation on APR and loan agreement

Many people hold the view that logbook companies have fixed interest rates. This is a misconception. Unlike banks that have the same interest rates all the branches across the UK, the logbook lenders operate differently. If you take the right approach, the lender will adjust the rates for you. When you make the lender a close friend, it will be easy to negotiate for better APR.

The best way to have the rates adjusted downwards is presenting an offer. If the lender has an APR of 210%, go ahead and present what you consider ideal for you. For example, ask the lender to give you a loan with an interest rate of 150% APR. The lender will have to talk to you for a better rate such as 170%. The drop will be significant when calculated over a number of years.

Assistance with improving personal credit score

The main reason that has landed you at the logbook loan dealer is poor credit score. After getting turned down by banks, it is only the logbook loan companies that are willing to assist you. However, making the lender your friend will make him go an extra mile in assisting with credit score improvement.

  • The lender will help you understand what credit score is and identify where things went wrong in your situation.
  • As a friend, the lender will assist you to craft a debt management plan. This will not just help in clearing the logbook loan, but all the other debts too.

Avoiding falling into further financial woes

Now that you have borrowed from a logbook company, it is important to appreciate that issues can arise and force you to default. For example, if you lose the only source of income, the chances are that the lender will recover and sell the car. But it does not have to be that way if you are a close friend to the lender.

  • The lender will help you identify areas of austerity and directing the cash to clear the loan.
  • Good lenders will assist you to automate monthly payment to avoid unnecessary penalties.
  • If repayment becomes completely impossible, the lender will assist you to weigh the options of last resort such as selling the car.

Support in increasing personal streams of revenue

The moment you settle for a loan, everything narrows down to budgeting. While you might have thought that all the sources of revenue are exhausted, a good lender will demonstrate how to raise extra cash while keeping the expenses minimum. Here are some great examples.

  • Redesigning your home to make some rental units.
  • Using the garage to run a side business such as baking cakes
  • Doing part-time job in your area of profession to raise additional cash
  • Working online in your area of specialization to raise more cash

When you identify a good lender, it pays to consider him a personal friend. As you put a lot of effort in clearing the loan, a friendly lender will give helpful advice on creating new streams of revenue and marching to financial freedom.

 

Making Your Logbook Loan A Stepping Stone to Financial Freedom

Every time that the name logbook loan is mentioned, what comes to people’s minds is a person who is in a financial crisis. This is true. In many cases, people looking for logbook loans have a very low credit score. This makes banks to reject their loan applications because of the high risks involved. However, getting at this point does not mean you cannot reach financial freedom. Here is the story of Michelle Grogan who overcame all odds to become a better financial manager after taking a logbook loan.

How Michelle sank into financial problems

Michelle Grogan, an industrial worker at a Bakery in London, was living a great lifestyle. As a single mother of one daughter, she felt successful because she had just completed paying her mortgage. However, she still had many loans that required a couple of years to clear.

In spring of 2015, Michelle’s daughter fell ill and was admitted to hospital for 6 months. This drained Michelle’s resources leaving her with no money to service her loans. Two months before her daughter was discharged, she took a logbook loan of £3500 against her car to cater for the fast-growing expenses.

Things ran from bad to worse when she lost her job a month after her daughter was discharged. At that point, she was pressed by the different debts, the logbook loans, and other expenses that come with taking care of a sick person.

Getting out of financial trouble and walking to financial freedom

  • Seeking and implementing recommendation of a financial expert

Seeing that the remaining sources of revenue could not cater even for the logbook loan, she had to seek an urgent solution.

  • She sought assistance from a financial expert who advised her to consider selling the car immediately. But this could not be done directly because the ownership documents were already deposited to the logbook loan company.
  • To get more from the car, Michelle searched for a buyer and went with him to the lender. She explained her situation, and the vehicle was sold for its total value of £ The lender deducted his loan of £3500, and the remaining £4000 was deposited in Michelle’s account.
  • Opening a new stream of revenue

The financial expert did not stop there. He was very concerned that even after clearing the logbook loan, Michelle’s problems were far from over. She had to also clear other loans. Therefore, she recommended that Michelle start a business to get new streams of revenue for clearing the remaining debts.

She converted her garage into a bakery and acquired baking equipment using the £4000 from the car sale. She also opened a website and started selling baking related recipes. With her daughter assisting with website administration and managing orders and Michelle working on deliveries, the business grew rapidly.

They enlisted services of another employee who helped to raise production and revenue. So successful was Michelle’s bakery by June 2017 that she incorporated her baking companies as bigger orders came knocking.

  • Improving personal credit score

As the company grew, Michelle designated some cash for clearing other loans. By mid-2017, Michelle had cleared all the loans, and the banks were now approaching her to assist with loans. By roping in the financial expert who assisted her, Michelle is walking towards financial freedom by implementing the following things;

  • Setting enough emergency plan to cater for any emergency
  • Insuring the business and her family’s lives
  • Diversifying investment by acquiring bonds and new real estates
  • Buying shares in other highly successful companies
  • Teaching her daughter about budgeting and financial management

Sinking to the bottom of financial trouble does not mean you cannot rise and be successful. Even if you take a logbook loan because of poor credit score, make sure to get expert advice on financial management. If Michelle managed to get out of debts stronger, you too can march to financial freedom.