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Logbook Loan

How to Shop for a Logbook Loan Wisely

Assuming you have exhausted all your options to borrow money, and have decided to finally release the cash from your vehicle, the next thing to do is make sure your loan will not cost you an arm and a leg. Here are some tips on how to find the most competitive logbook loan deal.

Use Comparison Websites

There’s a good reason comparison websites exist – they give you easy access to the most competitive loans in the market without ever having to leave your home. While these websites certainly do earn a commission for every successful deal they close on your behalf, there’s a bigger chance for you to get the best rates through them as compared to applying directly.

Another advantage with using comparison websites is that you can easily find an online logbook loan that is tailored to meet your needs. You don’t need to visit every lender’s brick or mortar store or even their official website. You just have to key in how much you need and the comparison site will do the work for you.

Check the Company’s Reputation

Even if a comparison website already found a lender for you, you may want to be extra cautious by checking the company’s reputation. There are a lot of unbiased review sites out there where you can gain valuable insights from other borrowers. Most of them are very helpful and would warn others about the companies to avoid.

Study the Loan’s Terms

Once you have the right lender in mind, it’s wise to check the terms very carefully. While the APR could be the most important factor in your loan, your decision should not be based solely on it. You may want to consider the duration of the loan, the late payment fees, and early repayment fees. While every borrower thinks they will never default, it’s hard to tell what may happen in the future, so you may actually be thankful for considering lower late payment charges.

Borrow Only What You Need

Bigger loans take longer to pay off, and the longer the loan stands, the more you’ll pay in interest. There’s also the risk of spending the money elsewhere if you borrow more than what you really need.

Negotiate

Even if you think you’ve got a reasonable offer in front of you, it would not hurt to negotiate a bit further. While there’s no guarantee you’ll be given a lower interest rate, many reputable lenders go out of their way to make repayments easy for you, such as allowing early repayments or giving grace periods.

Be Realistic

Lastly, it’s important to remember what you can afford. We will not lie about this part. Logbook loans are expensive, and there’s always the danger to lose your car if you fail to hold on to your end of the bargain. If things are already tough as it is, always consider what you can afford to spend in repayments and set your loan period based on that.

 

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Applying for a Loan

Applying for a Loan Despite Your Bad Credit

Taking out a loan on bad credit isn’t easy. But sometimes it can be the only solution to a financial situation, especially if you have no friends or family to turn to. With banks and other lending facilities finding it hard to trust you with their money because of your poor credit scores, it’s time to look at all available alternatives.

Payday Loans

In the UK, one of the most popular lending solutions for people with bad credit is the payday loan. This type of loan allows you to borrow money on the condition that you settle the debt on your next payday. Payday loans are unsecured, which means you don’t need to front collateral in order to get approval. All you need to show is proof of employment and income. The longer your employment history is, the better. You will also need to write the lender a post dated cheque that covers the loan amount and interests. Any unpaid debt will be rolled over to the next payday, along with the corresponding penalties.

Logbook Loans

Unlike payday loans, logbook loans require you to provide your vehicle as collateral before getting approval. Lenders don’t usually require background and credit checks before approving your logbook loan application, and you can have the money in less than a day. And even though your vehicle is being used as security against the loan, you still take it home with you and drive it. Logbook loans are a great way to borrow some much needed money despite having less than acceptable credit.

Peer-to-Peer Lending

Over the years, peer-to-peer or P2P lending has become an increasingly popular online platform that allows borrowers and lenders to communicate and establish loan agreements. Most of the loans that you can find though P2P lending are unsecured. And because you’ll be dealing with real people and not a bank or some other financial institution, you are likely to get more sympathy and a higher chance of getting approval even if you have bad credit.

Friends and Family Loans

Sometimes, your best hope in hard times can be the help you get from the people closest to you. You have a better shot at getting a loan from you parents, your best friends, or even your old college roommate than you have with a bank, so it’s worth asking them for help first before you go to the bank. And when they do lend you the money, be sure to make good on your word. Pay the loan back in full and on time, run the risk ruining your relationships with the people who care most about you.

In addition, just because the people closest to you can’t loan you the money you need doesn’t mean they can’t help you in other ways. They can always trust you enough to act as co-signer to a loan that you are trying to get approval for. This is especially helpful if your co-signer has good credit. Of course, you need to hold up your end of the deal and pay the loan back, or else your co-signer ends up paying for it.

Taking out a loan on bad credit should always be your last resort. But if you really need to borrow money, it helps to know that there are decent alternatives that you can turn to in order to get you back on track.

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Buying a Used Car

What to Consider Before Buying a Used Car

Buying a car is one of the most carefully thought out decisions you will ever make. Or at least, it should be. While buying a brand new car should be pretty straightforward, the same cannot be said when buying used cars. Here are some of the advantages and disadvantages of buying a pre-owned vehicle.

Advantages

Low Cost

In most cases, the cost of a pre-owned car will be lower than when it was brand new. A used car will almost always have less value than one that has just come off the production line.

Reliability

Sometimes, a brand new car will have revolutionary features that have not really been extensively tested in the real world. There’s a risk that you will be buying a rather expensive lemon of a car, with one or two issues that you wouldn’t have possibly known at the time of purchase. If you buy a used car, chances are you’ve already checked its reliability, and any potential issues would’ve already presented themselves by then.

Lower Rate of Depreciation

A pre-owned vehicle will lose value over time, but not as much as a brand new one. This makes a second-hand car a better investment, as you can drive it for a longer period of time before it loses significant value. On the other hand, the value of a brand new vehicle drops considerably as soon as you drive it.

More Available Options

With the sheer number of car models rolling off the production line each year, you can just imagine how many used vehicles are out there at any point in time. There will be more used cars on sale than there are brand new ones, and you have so much to choose from.

More Value for Money

You can get a high-end, second hand car for the same amount of money you’d use to buy a brand new, low-end model. For instance, a brand new, bottom-range Ford Fiesta can set you back £10,000. But if you look around hard enough, you can find a used model that has better features, such as the Ford Titanium, for almost the same price.

Disadvantages

Uncertain History

There will always be a risk of buying pre-owned vehicles from unscrupulous sellers. You have to trust that you are getting a car that has not been clocked or tampered with, or has not been written off in a previous, undisclosed accident. Be sure to check a second hand car’s history before buying it. Services such as the HPI Check can tell you if the car has unpaid finance, or if it has been reported as stolen, or if it shows signs of mileage discrepancy. You can also pay to have someone physically inspect the vehicle for you.

No After-Sales Service

Buying a used vehicle requires a little more work than getting a new car from the dealership because you have to liaise with the seller directly and inspect the car yourself. And you usually don’t get any guarantees in case you run into any problems, especially if you got it from a dishonest seller.

Lack of Customization

With pre-owned cars, you get what you’re given. There will be no option for you to order the car to your specifications. And while the exact set up that you want is bound to be available somewhere, finding it when you need it and at the right price is close to impossible.

No Warranty

Many of the cars available on the second-hand market today are no longer covered by the manufacturer’s warranty. If you find one that’s still covered, you still won’t be able to enjoy the full warranty as part of it has already been used by the previous owner. There are, however, car brands such as Kia that make for good second-hand options because of the transferable 7-year Kia warranty that they offer.

Poor Vehicle Condition

You’ll often find pre-owned vehicles in less than pristine condition. The car could smell like cigarettes, or the previous owner might have used it to transport pets. You may even find more than a few dings and scratches. You almost certainly won’t find many used cars in brand new condition.

Sometimes, buying a second-hand car is worth it. Other times it’s not. So do your due diligence, and avoid buying from less than reputable sellers. Always know what you’re getting into before making your decision.

 

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Car Financing

Everything You Need to Know About Car Financing

The challenge with buying a car isn’t about finding the right model as it is about knowing how to pay for it. When it comes to paying for your new ride, there are plenty of options available to you. Choosing the right payment method is important, so weigh your options well and take time to think it all through.

Here are some of the more popular ways to pay for your car.

Cash Payment

Buying a car with cash is one of, if not the most cost-effective, ways to pay for a new car. Paying with cash keeps you from having to worry about monthly instalments.

Personal Loans

Taking out a personal loan from a bank or other similar establishments allow you to spread the cost of your vehicle over a period of time. This payment method allows you to own your new car off the bat, but getting approved for a personal loan can be difficult if you have a bad credit rating.

Hire Purchase

This payment method requires you to make an initial deposit of around 10% of the total cost, then a series of monthly instalments spread over an agreed period. Unlike with personal loans, the car isn’t yours until the final payment is made.

Car Leasing

Think of car leasing as long-term rental. With this method, you make fixed monthly payments to use the car until the lease expires. There are two main types of car leasing: Personal Contract Hire, or PCH, and Personal Contract Purchase, or PCP. With PCH, you’ll never own the car, whereas with PCP, you have the option to make a balloon payment that essentially transfers ownership of the vehicle to you.

 

Other Payment Methods

Credit Card Payment

Using your credit card to pay for your car, whether partially or in full, gives you added protection on the full purchase cost. That is, as long as you pay a minimum of £100 via credit card, and you meet all of your monthly card payments.

Peer-To-Peer Loan

This is similar to personal loans but instead of borrowing money from a bank, you get the loan from friends and family, or from individuals through websites such as Zopa. While peer-to-peer loans don’t go through traditional financial institutions, you still need to have a good credit score.

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