Compare logbook loans

A major effect of bad credit is not being able to easily get a loan when you need one, but as always, there are alternatives, one of those alternatives is a logbook loan.

Compare logbook loans:

  • Borrow up to 70% of trade value.
  • Vehicle must be less than 10 years old.
  • Regular income, MOT, Tax and Insurance required.
  • No early settlement fees.
Representative APR:
Borrow from £500 to £50,000 for a period of up to 24 months.   Apply Now
  • Cars, Vans and Motorbikes.
  • Vehicle must be less than 9 years old.
  • Passport required for I.D.
Representative APR:
Borrow from £500 to £50,000 for a period of up to 7 months.   Apply Now
  • Vehicle must be less than 8 years old.
  • Proof of income required.
  • I.D., MOT, Tax and Insurance required.
  • No early settlement fees.
Representative APR:
Borrow from £200 to £50,000 for a period of up to 36 months.   Apply Now
  • Proof of income and I.D. required
  • No payment for the first 60 days.
  • Stores across the country.
  • No early settlement fees.
Representative APR:
Borrow from £100 to £5,000 for a period of up to 18 months.   Apply Now

How they work

As the name suggests, a logbook loan is a type of loan where you use your car as collateral to secure a loan, although you don't actually hand over your car; the lender simply holds onto your V5 logbook until you've paid off the loan.

The most important thing is that you own the car and have no finance on it, you should also have the V5 logbook in your name and address. The lender will also require other documentation such as the MOT, Insurance and your I.D.

Once you have all this in order, choose a lender and apply.

The next step will vary depending on lender but will include a car inspection; some will come to you, some will ask you to take your car to one of their locations for inspection.

Once everything is worked out, the agreed loan amount will be sent to your bank account and the lender will hold onto your logbook, you keep using your car as normal while you pay off the loan. Once the loan is fully paid off, you can contact the lender to arrange to have your logbook returned to you.

How they compare to other loans

Unsecured loans
Unsecured loans rely on your credit score and other information you provide such as your salary, therefore you might expect them to have a higher interest rate than the collateralised logbook loan, but that's not the case, even bad credit loans are cheaper, with interest rates of around 60% compared to over 300% which is typical of logbook loans .

Another advantage unsecured loans have over logbook loans is that you never have to meet with the lender, applications are completed online or over the phone, making them more convenient for the applicant.

Payday loans
Payday loans are an emergency source of cash when you need it, their advantage is how quickly you can get the money; it can be within an hour.
Compared to logbook loans, a payday loan has fewer requirements, for example, you don't need collateral. In addition you can complete the application online or on the phone.

In terms of interest, the stated interest of a payday loan is higher than that of a logbook loan, for example; 1700% Vs. 300%, but this is has more to do with the way representative interest is calculated and the durations of both loans, the actual cost of credit can be lower on a payday loan. For more see compare payday loans.


Logbook loans are not the best option even for those with bad credit scores, the reason being that despite being secured on a real asset i.e. your car, the lenders still charge a very high interest.
Also the process of having to go to a branch to present your car and hand in your documentation might be too cumbersome for some people; other loan types allow the entire application process from the comfort of your home.

But if you can't get a loan by other means and can't pay back on short notice, as is required with payday loans, then logbook loans might be right for you.

It is important to remember that you risk losing your car if you fail to repay the loan in full, make sure you ask the lender what would happen if they took possession of your car; it’s likely that the car has more value than what you will borrow, ask whether they’ll return the difference to you after selling the car and deducting what you owe.