Logbook Loan v Payday Loan – Differences?

Have you been turned down for a loan by a bank or another mainstream lender? Maybe you have a bad credit score, or a history of missing payment deadlines?

In this situation, all is not lost as there are other options available to you. For example, logbook loans and payday loans are becoming increasingly popular amongst people who cannot get a loan elsewhere.

More about logbook loans

Quite simply, a logbook loan allows you to borrow money against the value of your car. This is an excellent option when you need a larger amount of cash, but are having problems getting an unsecured personal loan because of bad credit.

One thing to take into consideration is that your car may be at risk if you cannot keep up with repayments. For this reason, you should think carefully before choosing a logbook loan.

Logbook Loan v Payday Loan

More about payday loans

Payday loans are certainly the loan provider of choice for people with bad credit. There are now more payday lenders than ever before, and this shows no signs of slowing down in the near future.

In a nutshell, a payday loan allows you to borrow a smaller amount of money until your next payday. This means that you can take care of the bills or get that urgent repair fixed right away, and then once you are paid by your employer you can pay back the loan.

The main disadvantage of payday loans is that they can be too easy to get. The majority of online lenders will approve you in minutes, and then the funds are sent to your bank account almost instantly.

While this may sound like a good thing, for many people it can be all too easy to start relying on payday loans to get by. In no time at all you can find yourself with multiple loans and no way to pay them back.

Once this happens, expect to see the debt collectors knocking at your door every day until they get their money.

So which one should I choose?

If you are looking for a larger amount of cash and your car has some value, then a logbook loan is the best way forward.

However, when you only need a smaller amount to tide you over, a payday loan is the best choice that you can make.

In both cases, think carefully before you decide to proceed, and always be confident that you can comfortably pay the money back in full and on time.

Julia Written by: