V5 Loans – How Your Car Can Help You In a Pinch

Cars are truly amazing machines. They are powerful, fast and beautiful. A nice sport car can make you look very cool on the road. But there is another way to use your car that you may or may not have known yet.

If you are in need for some quick cash, your four-wheeler can come in quite handy. No, I'm not talking about selling it or anything like that. What I'm talking about here is using your car to get a V5 loan.

These are secured loans (the car is used as a collateral against the borrowed sum), with which any resident of Great Britain, who is 18 or more years old and owns a car to his or her name, can borrow anywhere from £500 to £50,000 and still continue to use the car.

Of course, there are some requirements when it comes to what car can be used. Some of the sum you can borrow is determined by your income, but the majority of it gets determined by the model of the car, its age and condition. To illustrate a point, you can't get much for a 1987 used Yugo, but a year or two old Aston Martin can net you a pretty sum.

The car also needs to be registered on your name and it can't have any outstanding finances on it. Some lenders will allow a very small sum to be connected to the vehicle still, but they are rare. Be sure that you have also paid any taxes or other charges connected to the car.

The age of the car is another thing that determines the amount you can borrow. Or if you can get this loan in the first place. This varies from one lender to another and you should inquire about this with your lending company. Some of them don't accept cars older than 10 years, other go as far as 15 years, while some go as low as 7-8 years.

Finally, if you are approved for this loan, remember that, while you can still use the car as before, it now practically belongs to the logbook loan company. They get to keep the vehicle's V5 registration documents, which allows them to repossess the car if you default on the payments. Which means that they can send enforcers to your address and take away your car. Not a pleasant situation.