Logbook Loan vs. Other Bad Credit Loans
There are a number of bad credit loans available in the UK market. Of all these financial loan options, however, logbook loans may be the best alternative of the lot for a number of reasons. To find out if a logbook loan deal is indeed suitable for you instead of other bad credit loans, here is a quick guide to help you.
Payday loans are widely popular in the UK and not entirely for good reasons. In fact, the financial product is highly controversial because of its steep interest rates and the debt trap it puts many borrowers a prisoner of. With payday loans, you don’t need a security. You just need to be employed to avail loans between £100 and £1000 at a whopping representative APR of 1,000% on average. The loan must be repaid after 28 days or on your next pay check or you’ll pay even higher interest.
Guarantor loans are also popular in the UK catering to borrowers with bad credit history. Unlike payday loans, guarantor loans are less costly. On average, the loan product is advertised with 50% representative APR making it one of the most affordable loan options for people with bad credit. There’s just one hitch. In order to avail the loan, you need a guarantor with good credit who is willing enough to co-sign the debt agreement with you. Once you find an eligible guarantor, you can avail loans from £500 up to £7,500 or £10,000 depending on your income, your guarantor’s income, etc. To know more about guarantor loans, go here.
If you are looking to borrow more than £10,000 but you have bad credit then one alternative you can consider is a logbook loan. Unlike the other two bad credit loans mentioned above, logbook loans have more requirements. The borrower, for instance, must be a vehicle owner in order to be eligible for this loan. Your vehicle will be used as security for the loan allowing you to borrow more money. Most logbook loan providers offer loans from £500 up to £25,000. Some lenders even offer loans as much as £50,000.