11:06 26 October 2013
Logbook loans are advances supported by the Bills of Sales Act which requires a borrower to obtain a loan using his/her automobile as collateral. In the event of a borrower missing repayments, the vehicle can be taken and sold. If the collateral sold results in a shortfall, the lender can make the borrower pay the difference even without the court’s order. This type of loan is offered at higher interest rates.
What are the benefits of a logbook loan?
Due to prohibitive interest rates, borrowing from credit cards is usually quite expensive and hence not recommended. So, whenever you’re short of cash, check out alternate ways such as logbook loans for they are dependable as long as you have a vehicle to pledge as collateral to the loan.
When you pawn your vehicle for a burst of cash, it will be at the pawnbroker’s possession. Logbook loans on the other hand will allow the borrower to keep possession of the vehicle as long as regular payments are made. This way, the borrower can still carry out his/her everyday routine normally without much pressure. However, if repayments are failed, the vehicle can be seized and be sold to come up with money to cover the loan.
The maximum amount which you can borrow will be the value of your vehicle. However, you do not have to borrow more than you need. Borrow only what you actually need so that making payments is not a problem. When the amount is small, it will allow you to make repayments easily at lesser interest to boot.
Unlike bank loans, logbook loans are easily processed. All you need to do is bring the vehicle with you as well as the documents as proof of ownership and the loan is approved relatively quickly. The arrangements are not lengthy and painstaking.
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