Upheavals seem to strike the financial situation of most families over and over again during the past decade due to several economic changes and declinations. The middle class usually suffers the most, as the monthly salary of most individuals does not keep up with the unexpected rise in expenses. From bills to necessary purchases, the costs drain those that try their best to stabilize their financial situation.
Many find themselves facing terrible financial difficulties; and, turning to traditional sources of financial assistance, they get turned down by the rigid routine of such companies, which usually demand too many documents that are kind of impossible to obtain. With that being said, many find themselves looking for other alternatives that might get them out of their financial hardships.
Some choose to apply for a short-term loan or a payday loan to get cash as quickly as possible. However, it seems that such options might be disliked by some as the interest rates are rather high when it comes to short-term loans. The most popular alternative to these kinds of loans are logbook loans; and that’s why we chose to cover this area for you in order to acquire the proper knowledge regarding logbook loans.
- What is a Logbook Loan?
For you to understand the meaning of a logbook loan is to think about the main concept of a loan. A lending service conducts its business through a simple tactic: they provide the customer with an amount of money for a period of time, provided that the client has the means or the papers that guarantee the reimbursement of the borrowed money, in exchange for an interest rate. Logbook loans follow the very same concept, but with a minor difference.
The lending service of a logbook loan borrows you an amount of cash that is guaranteed by your owned vehicle. The company usually estimates the value of your vehicle according to certain measures, and lends you the amount you ask for, given it is within the limit of your vehicle’s value. The lender usually, in simple words, owns your vehicle as long as your debt in not yet repaid; but you get to use your car during the time you both determine for debt instalments. Each company has its own terms of services, interest rates and specific requirements for a logbook application. You should do a thorough research before going down that road.
- Do I Really Need One?
That depends on many factors. If you are in terrible need of a cash flow, maybe for a certain kind purchase or to pay off another debt, it might be the most feasible option there is. Logbook loans provide you with fast cash to get you out of your financial difficulty, which is contrary to traditional banking processes. What troubles some people about logbook loans is that the provider of your loan gets to own your vehicle in case your debt is not repaid. If you are quite certain that you would be able to repay your debt, this should not be much of a concern for you.
- Is It Easy to Apply For?