Circumstances under which getting approved for a logbook loan would be a tall order
The understanding out there is that credit checks are no hindrance to getting approved for a logbook loan. In fact, the soaring popularity of logbook loans is hinged on this premise. The idea that a person can get access to a loan without their credit score status becoming an issue is one of the reasons that has informed the immense popularity of logbook loans across the UK. While getting approved for a logbook loan is almost always guaranteed, there are a number of instances when one's logbook loan application will not be approved.
Having a car that is not legally registered in your own name
Don’t make the mistake of thinking that you can actually use a sibling’s car, a colleague’s car or even a fiancée’s car as collateral when applying for a logbook loan. When you do that, you can rest assured that your logbook loan won’t be approved. You must own a car duly registered in your name to qualify for a logbook loan.
If you are below 18 years of age
It doesn’t matter how bad you want a logbook loan or what form of financial emergency you are in. If you haven’t attained the legal age of 18 years, your logbook loan application hangs in the balance. The law stipulates that all contractual obligations should be entered into with a person of legal age (18 years or above). As such, if you are a minor, you might as well as save your time as your logbook loan application will not be approved.
Setting up a car as collateral yet it doesn’t have comprehensive insurance
Anything can happen to your car at any time. It is perhaps for this reason that logbook loan lenders require your car to be fully insured to minimise risks on their side. You must furnish the lenders with the cars tax details as well as insurance details as a prerequisite to approval. If your car is not fully insured, the lender might decline your application for a V5 loan.
Of course, every lender is willing to advance a loan to a person that is capable of repaying it without any problems. As such, if you are wallowing in unemployment and unable to make repayments monthly, logbook loan lenders won’t take chances with you. You need to show proof that you are capable of repaying your loan without any problems.