You may have heard stories of people claiming that they had a negative experience with logbook loans. Unfortunately there are some shady lenders out there who aim to scam you. These lenders make up a very small percentage of logbook loan providers and there are some steps you can take to avoid having these incidents happen to you. Also, with many logbook loan complaints, the lenders are actually not at fault. Your best defense to having a bad experience with logbook loans is to be informed and know what you are getting into before signing your loan documents.
One common complaint about logbook loans is that some lenders are illegally repossessing the vehicles of borrowers. Your loan agreement will outline the terms under which the lender can repossess the vehicle. Usually you will have to miss at least a couple of payments before lenders will pursue repossession. One thing that people fail to realize is that it can be costly to repossess a vehicle. It’s a very common practice of people who default on their loans to go into hiding and try to hide their vehicle as well so the lender has to use a vast amount of resources to find the vehicle.
Another issue people have reported with their logbook loans is that lenders harass them for repayment. This complaint occurs in almost any industry where collections are a part of the process. Realize that there is a difference between attempting to collect a debt and harassment. There are laws and rules in place that lenders must comply with in regards to collections. And you also have to consider the fact that lenders are required to make a certain amount of attempts to contact you before they can go through with repossessing your vehicle for non-payment. Logbook loan lenders are a business just like any other and their goal is to make money. If you feel that you are being harassed, simply express this to the lender and explain your financial situation. You would be surprised how willing some lenders can be to work with you if you explain your situation to them instead of dodging them.