Warning: Late repayment can cause you serious money problems. For help visit moneyhelper.org.uk/en. We are a broker and not a lender. We don’t make lending decisions.

Get my quote

Logbook Loans

Logbook loans are a type of secured borrowing that allow you to use your vehicle as security for a loan. They can sometimes feel like an easy option if you need money quickly and have been turned down elsewhere, but they come with important risks that are worth understanding before you consider them.

How much would you like to borrow?
Representative 79.5% Rates from 48.1% APR to 1721% APR. The minimum Loan Term is 3 months. The maximum Loan Term is 36 months. Representative Example: £1,000 borrowed for 18 months. Monthly Repayment of £89.22. The total amount repayable is £1605.96. Interest amounts to £570.44, an annual interest rate of 59.97% (fixed) Representative APR: 79.5% (variable). ^Subject to lender approval. Cash within 60 minutes is possible, depending on whether your bank supports Faster Payments. Otherwise, funds may take 24–48 hours to arrive.

What are logbook loans?

A logbook loan is a loan secured against your car. The lender uses a legal agreement called a bill of sale to take ownership of your vehicle while you continue to use it. You then repay the loan in instalments over an agreed period. Once the loan is fully repaid, ownership of the car is returned to you.

Because the loan is secured, lenders may be more willing to approve applications from people with poor credit. However, the trade off is that if you fail to keep up with repayments, the lender has the right to repossess your vehicle.

How logbook loans work

When you apply for a logbook loan, the lender will assess the value of your car and decide how much they are willing to lend. You will usually need to own the vehicle outright and it must meet certain criteria around age and condition.

If your application is approved, you sign a bill of sale that gives the lender legal ownership of the car for the duration of the loan. You then receive the funds and make repayments, usually monthly. If you keep up with payments, you continue to use your car as normal. If you fall behind, the lender may take steps to recover the vehicle.

Why people consider logbook loans

Logbook loans can appeal to people who need access to money quickly and have struggled to get approved for other types of credit. Because the loan is secured against your car, some lenders may be less concerned about your credit history.

For someone facing an urgent expense, this can feel like a straightforward solution. However, it is important to weigh this convenience against the potential risks involved.

The risks to be aware of

One of the biggest risks with a logbook loan is the possibility of losing your vehicle. If you rely on your car for work, family commitments or everyday travel, repossession can have a serious impact on your life.

Interest rates on logbook loans can also be high, meaning you may repay much more than you originally borrowed. It is important to look closely at the total cost of the loan, not just the monthly repayment.

Another factor to consider is that some people do not realise they no longer legally own their car while the loan is in place. This can come as a shock if they later want to sell the vehicle or if problems arise with repayments.

Are logbook loans regulated

Logbook loans are regulated in the UK, and lenders must be authorised by the Financial Conduct Authority. This means they are required to follow rules around responsible lending, transparency and treating customers fairly.

Even so, it is still important to read the terms carefully and make sure you fully understand your rights and responsibilities before agreeing to this type of loan.

Alternatives to logbook loans

For many people, there may be safer and more flexible options than using a vehicle as security.

Personal loans for bad credit can be one alternative. These are unsecured loans, meaning your car or other assets are not at risk. While interest rates may still be higher if you have poor credit, you avoid the possibility of losing your vehicle.

Payday loans and short term loans can also be an option for smaller amounts, provided they are used carefully and repaid on time. These loans are designed for short term needs and should not be used as a long term solution, but they may be more suitable than a secured loan for some borrowers.

Credit unions are another route worth exploring. They often offer more affordable loans and take a supportive approach to lending, especially for people on lower incomes or with less than perfect credit.

If you receive certain benefits, you might also be eligible for government support such as a Budgeting Advance, which can be a lower cost way to deal with essential expenses.

How Dot Dot Loans can help

At Dot Dot Loans, we do not offer logbook loans. Instead, we help you compare alternative borrowing options that may better suit your situation. We work with FCA authorised lenders who provide personal loans for bad credit, payday loans and other short term borrowing options.

Our service lets you explore what may be available using a soft search, which does not affect your credit score. This means you can see your options before deciding whether to go ahead with a full application.

We focus on helping you understand the pros and cons of different types of borrowing, so you can make a more informed choice. For many people, an unsecured loan or short term option can offer the support they need without putting their vehicle at risk.

Things to consider before borrowing

Before taking out any loan, it is important to think about whether borrowing is the right solution for your situation. Ask yourself whether the repayments will be affordable and what would happen if your circumstances changed.

If you are unsure, speaking to a free debt advice service can be a helpful step. They can help you look at your wider financial picture and explore options that do not involve borrowing more money.

If you do decide to take out a loan, make sure you only borrow what you need and can comfortably afford to repay. Understanding the full cost, the repayment schedule and the consequences of missed payments can help you avoid problems later on.