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Claim a Logbook Loan Refund

Have you had a logbook loan that you couldn’t afford to pay back? These popular types of loans have been widely mis sold. If you’ve previously had a logbook loan you could be eligible to make a claim, it only take 5 minutes.

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What are logbook loans?

These are short-term loans secured on your vehicle. It can be a car, van, truck, motorbike, or another vehicle. The lender keeps the vehicle’s logbook (V5C) and “owns” it until you repay the loan.

Logbook loans are designed for people whose bad credit rating prevents them from getting more conventional financial support. They’re available online and on the high street.

Before offering a logbook loan, the lender should provide:

    • Key facts document  about the personal loan agreement (how much you borrow, repayment terms), so you can understand the kind of agreement you’re entering into.
    • Customer Information Sheet – a document that describes what a bill of sale is, your responsibilities, and how you can expect the lender to behave.

After signing a ‘bill of sale,’ you get a quick loan (typically between £500 and £50,000 ) and can keep driving the car as long as you make repayments. Some agreements might let you only repay the interest charges until the last month of your contract, where you’ll be required to repay the whole amount of money you originally borrowed.

Once you pay the loan in full, the associated bill of sale becomes void, and the car’s legal ownership reverts to you. This might seem like a good choice for someone in a tight spot. But if you don’t keep current with payments, the lender has the right to use bailiffs to seize your car (unless you can come to some sort of payment arrangement).

They do not have to go to court to do this. Typical Annual Percentage Rates (APRs) are high, often 400 per cent or more . You’ll often repay more than double the amount you borrowed, so logbook loans are an expensive form of credit.

The high-interest rates on logbook loans can tempt you to sell the car even though you’re legally not allowed to. You cannot sell a car secured by a bill of sale agreement because you technically do not own it until the debt has been paid off – this can take anywhere from a few weeks to over a year.

Why make a logbook loan claim?

Logbook loans have been widely mis-sold. They’re very expensive, target people with poor credit and are often far too easy to get. If you were mis-sold a logbook loan, it could put you in a worse off financial situation than you were in before you took it. The use of bills of sale in logbook loans has long been associated with lender malpractice, such as:

Lack of comprehensive affordability assessments

Lenders must examine your finances before offering you a logbook loan to certify that you can afford it, and the fees. Affordable means you can manage repayments without hardship or having to borrow elsewhere. This isn’t a gesture of goodwill but rather part of the good practice customer charter and rules imposed by the FCA.

People that take out logbook loans are often financially vulnerable and sometimes heavily over-indebted. Some lenders don’t perform a reasonable affordability assessment and offer logbook loans that the borrowers obviously wouldn’t be able to pay back on time.

If your lender didn’t make a comprehensive affordability check, then you have grounds for a complaint.

Irresponsible debt collection practices

The power imbalance between the borrower and lender can fuel aggressive and harsh debt collection practices, causing financial and psychological harm.

Exploiting the vulnerable

The interest rates for logbook loans are particularly high for secured lending.
This, plus punitive fees and charges, means missing a single payment can spiral quickly into significant debt. Debt causes severe consumer detriment.

Unclear and outdated terms and conditions of logbook loan agreements

The language used in agreements is often unclear and outdated. This can lead to borrowers not understanding the terms and conditions of the loan, for instance, not always realising that they could lose their car if they do not keep up repayments.

It can also result in borrowers not understanding that they no longer own the car on which the loan is secured. Understanding the risk involved is key to making an informed choice about taking out a loan.

A significant lack of protection for borrowers

Under logbook loans, ownership of the car put up as security for the loan changes from the borrower to the lender; therefore, the lender doesn’t need a court order to repossess the car.

Since consumers are concerned about the possibility of losing their vehicles, they feel forced to put logbook lenders first on their list of creditors (above priority debts).

Did you know?

Lenders shouldn’t repossess your car unless you owe an amount equal to at least the last 2 monthly payments. If you’re paying weekly, they should not repossess it unless you owe an amount equal to the last 4 weekly payments.

Check your eligibility for a logbook loan claim

You can claim compensation from both existing logbook loans and those you’ve already paid off, provided you raise the case within 6 years of taking out the loan.

If one or more of the following statements apply to your circumstances, you’re eligible for a loan claim:

Poor assessment

During your application process, you may have failed to mention all of your debts, and if this did not match your credit record, the lender should’ve addressed this.

Irresponsible lending

It’s possible that you miscalculated your monthly expenditure because you were eager to be eligible for your loan, and in such situations if your figures appeared too low, your lender should’ve explored their reliability further.

Employment status

Did you have a regular income at the time of your application? If you were self-employed or even had overtime that fluctuate during this period, the lender should’ve looked at this.


The lender did not deal with you “sympathetically and positively” when repossessing your car.

Loan extension

The lender pressured you to extend the loan, didn’t tell you about the risks of extending the loan, or failed to clarify just how much it would cost to extend the loan.

Repayment plan

The lender did not offer to freeze interest and charges if you were incapable of making payments under a reasonable repayment plan.

Debt recovery

The lender took away your car without adhering to the terms of your agreement.

Personal possessions

You had personal possessions in the car before the lender repossessed it, and you have not been able to get them back.

Debt advice

The lender didn’t inform you about free and independent debt-counselling organisations.

Did you know?

If you experience difficulty paying the loan, the lender must consider options with you to see how you can repay the debt. They should only repossess the car if they can’t reach a repayment agreement with you to clear the arrears.

Don’t worry if this all sounds too daunting, that’s the job of the legal experts to sort.

Evidence that will help your logbook loan claim

For a claim to be successful, the following can help, but is not mandatory:


Credit report

A credit report showing that you were unable to afford the loan repayments. This will prove that the lender failed to check your finances properly.

Bank statements

Bank statements showing the lender made deductions straight from your salary, which caused you difficulty when you needed to ask for a payment arrangement.

Application form

Your application form showing you didn’t include payday loans as credit commitments as you thought that was for long-term credit.

Recent credit applications

Recent applications for credit or previous issues on your credit record. The lender should’ve been conscious of whether your financial situation appeared to be worsening.

Hidden charges

Documents showing the lender unfairly added hidden/extra charges to the loan that they didn’t tell you about.

Unprofessional behaviour

Proof that you were subjected to threatening, aggressive or unprofessional behaviour when you experienced repayment difficulties.

Common questions

How much could my claim be worth?

Regarding how much your claim may be worth, it’s all about being put back to where you should’ve been financially if you’d been treated fairly or not mis-sold in the first place.

Over the years, we have seen logbook loan reclaims ranging from £10s to £1,000s, but as a general rule, you will likely be refunded interest + any charges and fees from the moment you were mis-sold or deemed to have been treated unfairly.

Can ‘black marks’ on my credit report be removed?

Yes, they can. Besides the refund, you can appeal for any poor payment records on the logbook loan to be removed from your credit report. Credit reference agencies take instructions from lenders, so it’s up to the lender to request to remove them.

What if my claim is rejected?

If your claim is rejected, or you’re unsatisfied with the final offer from the lender, you can escalate your issue to the Financial Ombudsman Service (FOS). This is the official, independent body for settling disputes between consumers and financial companies. To lodge a complaint, you’ll need to fill in the ombudsman complaint form .

What if my lender goes bust?

You can still make a mis-selling complaint after a lender has gone bust.
How much you’ll get, however, all depends on how much money is leftover and the number of creditors this has to be shared between.

What if my car has already been sold?

If your car has been repossessed, the lender would be asked to return it. If, however, they’re unable to do so (if the car has been sold, for instance), then you’d be compensated for the car’s value.

Don’t Delay. Check Now.

Don’t miss out on £100’s or even £1,000’s in compensation you could be entitled to. Starting a claim only takes 5 minutes, so why not do it now?

You do not need to use a claims management company to make your complaint to your lender. If your complaint is not successful you can refer it to the Financial Ombudsman Service for free. Claims Bible does not charge you for our service, we may be paid a fee by the final supplier for any introductions. This will not impact on any costs incurred by you.