Logbook loans involve taking out a loan against the value of your car. Although they are technically a secured debt, they don’t have the same level of security compared to the kind of finance agreement that’s available from your bank or a loan company.
A logbook loan is usually used to borrow small amounts of money, however it has a much higher risk than other debts. Your credit score will be negatively impacted, you might lose your car and you’ll have additional interest and charges to pay back on top of the original loan.
A logbook loan is not recommended to use to pay off other debts. Usually, logbook loans are very expensive and the interest rates could be as high as 450%. A logbook loan is usually a last resort, however we do not recommend taking one out because of the high charges and risks it comes with.
If you’re thinking of taking out a logbook loan as a way of paying off your debts, you should book a free debt consultation with Money Support Group first.
Our expert financial advisors can let you know about all of the debt solutions available to you and there will likely be a better option out there for you rather than a logbook loan.