Alternatives to Logbook Loans

There are circumstances when getting a logbook loan is the last and best resort for your financial situation. And that's exactly what logbook loans are. The financial product should be your last resort when resolving your financial emergencies. Before signing that logbook loan deal, it pays to consider the following cheaper alternatives:

Borrow from Family or Friends

For small sums of money, you can always ask family and friends for a loan first. This way you don't have to pay for high interest personal loans. This is an ideal option if you need £200 to £500 for overdue bills and medical emergencies. Just make sure that you pay the loan at a date you promised to pay for it. Otherwise, you might put your relationship with your family or friend in a difficult spot.

Cash Advance

If family and friends do not have extra cash to spare and you need money before payday, you can ask for a cash advance from your employer instead. If you only need a small sum, chances are good that your employer will approve your advances at a much lower interest rate than unsecured personal loans like logbook loans or payday loans. Repayment is generally deducted on your next paycheck so it’s important to consider your budget thoroughly before requesting for cash advance.

Credit Union

Credit unions are another great place to borrow short term personal loans at low interest rates. If you're a member of a credit union, considering it as one of your first resort makes perfect financial sense. Credit unions members in the UK can generally borrow from £100 up to £1000 or more depending on your credit union membership. Interest rate is somewhere at 12% onwards which is significantly cheaper than personal loan options for people with bad credit.

Credit Card

If you have a credit card you've not maxed out yet, you can always use that to cover for your current financial needs. You may also ask for a temporary increase in your card limit if possible. This option could be dangerous however. If you are going this route, you need to make sure that you will be able to pay the extra card limit in full by the end of the month.

Peer to Peer Lending

Another great option that's gaining popularity among borrowers with bad credit is peer to peer lending or P2P. With P2P lending, you can borrow a small sum of money at a lower interest rate. Rather than borrow from a company, you borrow from an individual. This means that the middle man has been removed from the picture which makes the loan option more affordable for borrowers.