You have taken out a logbook loan thinking that you will pay it back quickly, only to find that circumstances didn’t work out the way you would have liked them to and you aren’t able to meet your regular payments.
This happens, life isn’t always straightforward and unexpected events crop up to throw plans you had up in the air.Loan repayment
The first thing to do is not to panic and speak to the logbook lender that you arranged the loan with and tell them that you are having difficulty making payments. A good lender will come to an agreement with you regarding the debt balance. They may be able to defer the payment until you can put the money together or, lower the payment for a short time.
You need to show evidence that you are working to find the money and intend to make the next payment as soon as possible. When you take out a logbook loan you are putting your car up as security for the loan and this is always at risk if you don’t pay the loan back. The lender legally owns your vehicle and can repossess it at any moment.
For this reason you need to cooperate with the lender as much as possible in order to reduce the possibility of your vehicle being repossessed. They will want to help you resolve your payment problems because they will often repossess your vehicle as a last resort. It isn’t ideal for them as they have to spend time and money doing this, when they would rather you made the payments due.
If you are having debt problems there are charities out there that can assist you and give advice. The Money Advice Service is an excellent place to start and we recommend this to anyone looking to educate themselves about money issues.
There are plenty of other charities out there who will lend a hand to helping you solve your debt problems. This is a useful list from the HMRC of some of the main organisations, and we have come up with our own list here.
It can take time and patience to clear a logbook loan that you are having trouble with. A good lender will give you that to a certain extent. It is not a good idea to take out a logbook loan to pay off another similar loan. You are likely to find yourself falling further into debt, with less hope than before of paying the loan off. Focus on paying the original loan off first so you get your finances back on track as quickly as possible.