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.