Short-Term Fix With Long-Term Expense

Posted May 2, 2013 by prsub123

If you suffer from poor credit and need to borrow money, loans bad credit loans prove to be the answer.

Got a car? Get a loan! This is the catch phrase being used to appeal to borrowers needing cash within no time. The aim is to provide fast and easy solution to a customer’s financial needs. If you suffer from poor credit and need to borrow money, loans bad credit loans prove to be the answer. But one has to be careful and explore different options before fixing on one kind.

Some of the lenders promise to lend to people who have a bad credit history, or even who have been made bankrupt in the past. The borrowers are given an option of not paying for 60 days after the loan is taken, even the payment period may be chosen by the borrowers to suit their needs. The lenders come directly to you to make the payment or transfer it into your accounts. Hundreds of stores of the lender offer conveniently these loans bad credit loans. If the stores aren’t accessible they even arrange a meeting point for you.

Such loans are infusing a breath of fresh life for previously bankrupt people, unemployed or self employed who are able to make monthly payments. All they ask is for your vehicle’s logbook to be kept as collateral. A sign over the vehicle’s V5 book will create a lien for the lender who can use it to repossess in case of any defaults by the borrower.

Unlike a normal loan which is secured against an asset like a house, car or property, where the lender needs to go to court to take possession , logbook loans already owns the vehicle taken as collateral.

A borrower will seek a lender either through the internet or at a daily place location. In order to secure the loan, the borrower will need to carry his ID along with the paperwork of his vehicle. The amount of the loan is determined by the collateral which is the vehicle. The maximum can go up to more than 50% of the value of the vehicle. The borrower must hold clear title of the vehicle with no liens or current financing. Some lenders might require the borrower to have vehicle insurance.

The schedule of payment may vary but the borrower will have to pay the interest due on each due date. Such loans for bad credit can be repaid in a single payment. If the borrower is unable to pay back the loan or is late with his or her payments, the logbook owner can now seek possession of the vehicle or sell it to offset what is owed. Typically lenders choose this option as a last resort because it may take months to recover the vehicle, and repossession, auction costs all decrease the amount of money they are able to recoup. These loans for bad credit have been on the rise in countries like UK and USA of late.

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Last Updated May 2, 2013