V5 loans can help you make the most of your car. Do you know how? By releasing funds so you can use them to invest in other aspects of your life. Your vehicle is a valuable asset that can be used to your advantage, so why not reap the rewards, while using it? Before you decide, check out the pros and cons of V5 loans and read up on how the process works.
Your Car Is Like Your House
Okay, first thing's first - what does one mean when they say that your car is an asset, and that you can "free up" money? The concept is simple, and we're going to use your house as an example to illustrate the process. In fact, I'll give you the short version right now: imagine that you're getting a mortgage, but on your car, instead of your house. It's exactly like that.
Now, for the longer explanation. When you've got a valuable asset, such as a house, a car, or a piece of land, you can use it to secure a loan by putting the asset up as collateral. In simple terms, it's used as leverage, or as security for the lender. They're holding your asset "hostage" until you repay the loan. If you should fail to repay, then the asset remains in their possession in order to cover for the money they lost.
Now, you know how you can get a mortgage (or even a second mortgage) on your house? What happens there is that you are securing a loan, using your home. You can do the exact same thing with your car! If you own your vehicle, it doesn't have to just sit in the garage, when it can make money while you still get to use it.
Release The Funds And Use Them Wisely
Ok, but why would you offer your car up and get money for it? Maybe you don't need money, and that's great. However, these funds can be used to invest in your future in some way:
Improve your home
Getting payday loans against your car doesn't mean you can't use them to improve your home, instead. Perhaps you're looking into selling it, and you need to make some last-minute changes to drive up the value, or it just needs maintenance. Depending on the value of your car and your affordability, you could get enough funds to get a home makeover.
Buy a second car
Are you struggling with just one family car? It can be extremely inconvenient, which is why you may want to get the money to buy a second car, second-hand. Perhaps your spouse may need one, or you have a teenager who needs some independence. Give it to them and consider it an investment in your own sanity.
Make an investment
Or, you could make an actual investment, in your business, or someone else's. Why not use this opportunity to make more money that you can eventually re-invest again? Make the most of your money and reap the rewards!
How To Use My Car For A Loan
If the idea of using your car to get money appeals to you, then you just have to go out and apply for a V5 loan. Also known as logbook loans, V5 loans entail borrowing money in exchange for giving the lender temporary ownership of your car.
How it works
In order to get this loan, your car is going to be assessed (preferably by a third, independent party!) and then you are going to be offered an amount. You hand over the logbook and registration papers for the car, but you get to keep the car and use it normally. Then, you start repaying the loan in instalments until you've repaid the full amount (with interest!) and you get your papers back.
What you need
In order to be able to benefit from a loan that you secure with your vehicle, you must have:
a) A car that you own, of relative value
b) Registration papers and logbook
c) Your name on the registration papers
How much you can get
In terms of amounts, you can get anywhere from £250 to £50,000, but you must know that it does depend on how much your car is worth. After the assessment, you will be told how much it's valued at; the lender will not offer you the full amount, but a certain percentage of that value. The least some lenders offer is 50%, but you shouldn't settle for that.
How long you repay
The loan is repaid in normal, regular instalments, but be careful - unlike a secured loan on a house, which will be repaid over decades, a logbook loan needs to be paid in full, including interest, within 78 weeks. That's not a particularly generous time line, and it can result in fairly high weekly instalments.
As you can see, your car can be so much more than your reliable choice of transportation. Take advantage of its full value by maximising its potential and releasing funds. It's easy to get money from your car with logbook loans. All you have to do is find a trustworthy lender and give them the registration and logbook and you can walk away with a pile of money and keep your car at the same time. It's the best of both worlds and you can take advantage of this opportunity to get this extra money and use it for something else you really need or want in your life.