Logbook loan: Difference between revisions
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==External Links== |
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*[http://www.adviceguide.org.uk/scotland/consumer_s/consumer_cars_and_other_vehicles_e/consumer_problems_with_the_car_you_bought_e/consumer_the_vehicle_you_bought_doesnt_match_its_description_e/you_have_bought_a_car_that_has_a_logbook_loan.htm Citizens Advice Bureau UK on Logbook Loans] |
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*[http://www.stepchange.org/ StepChange Debt Charity UK] |
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*[http://www.logbookloansuk247.co.uk Logbook Loans UK] |
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*[http://www.nationaldebtline.co.uk/ National Debtline UK] |
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Revision as of 10:34, 12 January 2014
A logbook loan is a British term for a bill of sale securing a loan on a debtor's vehicle (with the lender retaining the vehicle's "logbook", or vehicle registration certificate). The structure of the loan means that the lender can repossess the debtor's vehicle without a court order. This distinguishes it from a car title loan, as used in the United States.
Logbook loans have gained notoriety in the United Kingdom due to their often very high interest rates and potentially unfair terms and conditions. Logbook loans are used for people that have bad credit that need cash quickly. Logbook loans can be completed in as little as 15 minutes. The applicant must have proof of a steady source of income to be approved for a logbook or V5 loan.
In December 2009, the UK government announced a consultation on whether to outlaw logbook loans. A Logbook Loan may only by issued by a company if it holds a "Consumer Credit Licence". The loan is secured using legislation from 1878 known as a Bill of Sale. This legislation allows companies to seize the asset i.e. in the case of non repayment of the loan. This was denied.[1]
See also
References
- ^ Bachelor, Lisa (2009-12-22). "'Logbook loans' to be outlawed". The Guardian. London. Retrieved 2010-04-26.
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