Circumstances under which a logbook loan approval may not be possible

If you look around, you will notice that the selling point of logbook loans has to do with the fact that it brings on board individuals with a bad credit without taking into consideration their history of defaults, arrears or even CCJ. The misconceptions therefore has been that getting approved for a logbook loan is a guarantee. While it’s true that logbook loans have been quite instrumental in helping thousands of UK individuals with a less than average credit score get approved for a loan, the reality of the matter is that there are exceptions or instances when approval for a logbook loan might prove a mirage, an impossibility of sorts. What are these exceptions?

Car not registered in applicants own name

While UK logbook loan lenders endeavor to approve every application of a logbook loan, there is an exception to that rule especially if the car the applicant sets up as collateral is not registered in their own name. In simple terms, a person must provide as security a car that is registered in their own name and not one registered in the name of a friend, a colleague or even family member. To do so would be grounds for rejection.

Car condition

A car that is not in good condition or which has been in operation for a period exceeding 10 years cannot be accepted as collateral and therefore inadvertently leads to logbook loan rejection. The rule is that a car to be set up as collateral should be in good condition (the reason why provision of a MOT certificate is mandatory) and not have been in operation for more than 10 years. If the car is older than 10 years, your application for a logbook loan would not be successful.

Infactual information

Of course, the onus is on the applicant to provide truthful information on the application form. While honest errors can be entertained, willful submission of infactual information would lead to the application being out rightly rejected. An applicant should be honest at all times and should not try to use false information with the view of being approved for a logbook loan.

Financially attached car

One of the conditions when applying for a logbook loan is that the car a person sets up as collateral should not have any charges or financial attachments to it. What this essentially means is that the car should be attached to any active loan. If it is, then the UK logbook loan lender will not be in a position to accept it as collateral and as such will lead to outright rejection of your logbook loan application.

If you are not of legal age or a resident of the UK

You cannot apply and get approval of a logbook loan if you are below the age of 18 years or if you are not a citizen or a resident of the UK. The rules are quite clear that you need to be a person of legal age, a resident of the United Kingdom and a person of sound mind before you can be considered for a logbook loan.