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Help with Logbook Loans / Self-help Guide

Wednesday, 27th February 2019

Our Mike Thomas, the founder of Debtwizard, says: ”Knowledge is power, unfortunately too many consumers just do not know their rights.”

The article below aims to give you an insight as to what you can do if you are struggling to pay back on a log book loan or your vehicle is soon or has been repossessed by the logbook loan lender.

This is a 'help with logbook loan self-help guide'. If you are experiencing problems with a logbook loan then note this  is not legal advice. If you do need legal advice then see our ‘Where to get Help’ section 8 below with details of agencies which can assist you.

BBC Inside Out London

You can watch debt finance specialist Mike Thomas as he investigates the rise in logbook loans and exposes how unscrupulous car sellers are shifting their debts to unsuspecting buyers.  Watch here - BBC Inside Out - London


In this article we look at:

    1. Log Book Loans new code of practice
    2. FCA Debt Collection Guidelines
    3. Bill of Sale (BoS)
    4. Time Orders (arrears only or on the whole agreement)
    5. Your options according to your problem
    6. Purchased a used car with a Log Book Loan attached
    7. Affordability complaint - What is irresponsible / unaffordable lending? - Template letters
    8. Where to get help.


Log Book Loan Self-help Guide

If you need to know what a logbook loan is then visit our other guide - What is a logbook loan?

1.  Log Book Loans Codes of Practice

On the 1st February 2011 a voluntary code of practice was launched for all Log Book Lenders who are members of the Consumer Credit Trade Association, (CCTA) which deals with debt collection, enforcement of arrears and innocent purchasers of vehicles with previous log book loans attached.

You can view the code here - The Consumer Credit Trade Association - Log Book Loans - Code of Practice and it will help if you take time out to read it as it is referred to throughout the guide.

2.  FCA Debt collection guidelines section re Log Book Loans

Many individuals in debt are often subject to unnecessary harassment by lenders so it is important that you know your rights and how to deal with over- zealous debt collection agencies.

The following link takes you to our page that offers the Financial Conduct Authority (FCA) Debt Collection Guidelines.

3.  Bill of Sale - Log Book Loan

When taking out your loan you have to sign a Bill of Sale (BoS) along with the credit agreement. By signing the bill you temporarily hand over ownership of the vehicle to the loan company giving them the right to repossess the vehicle without a court order in the event that you default on the payments.

A BoS has to be registered in the High Court with seven days of it being signed and you can check to see if this has been done by writing to the High Court enforcement team at The Royal Courts of Justice, The Strand, London or visiting them in person. You will need to give the Court the name of the person who gave the bill of sale, the name of the loan company and the date of the bill of sale..

To be valid and enforceable a Bill of Sale must be in a prescribed format. The specific requirements are too lengthy to relate in this self-help guide and you should seek advice if you are unsure, however in the first instance you should check that it includes:

1. Date of the bill

2. Names and addresses of the Parties

3. Statement of the true consideration given

4. Acknowledgement of receipt of the advance

5. An assignment by way of security of personal chattels capable of specific description

6. That it is a monetary obligation (rather than any other) that is secured

7. Statement of the sum secured, the rate of interest and the repayment instalments

8. Agreed terms for the maintenance and defeasance of the security (ie that upon payment of the principal sum plus interest, the bill shall be void)

9. A clause limiting the grounds of seizure

10. Execution by the debtor

11. Attestation by a credible witness who is not a party to the bill

12. A schedule describing the secured chattels (this description must not appear within the body of the bill)

4.  Time Orders with a Log Book Loan

What is a time order?

A time order is a way of asking the court to give you more time to pay a loan agreement if you have fallen behind with the payments. It can change:

* the amount you have to pay each month;

* how long the loan will last;

* in some cases it is also possible to change the interest rate.

A time order is particularly useful if you have a secured loan and your lender is threatening to repossess your home or your car.

The law has not been entirely clear on what the court's powers are when making a time order. Following two court of appeal cases, time orders seem to apply in two situations.

Time orders on the arrears only

Sometimes a time order can only help with how much you should pay every month on the payments you have missed, leaving the ongoing monthly payments unchanged. This might mean the court also needs to look at changing or freezing the amount of interest being added to the arrears and possibly the interest rate on the whole balance you owe under the agreement.

This is the case if the lender has only sent you an arrears notice (or in some cases a default notice) but the whole loan has not been called in. This is more likely where you have only had an arrears notice, as under the terms of most agreements the whole loan is called in automatically when the lender sends a default notice to you.

Time order on the whole agreement

You may have to wait for the loan to be called in before making your time order application if you want to ask the court to reduce the payments you have to make on the whole agreement and not just the arrears.

Sometimes a time order can be used to change the whole agreement, setting lower payments and interest charges, and in certain circumstances stopping interest being added at all. This can only be done when the whole loan has been called in by the lender, where the loan agreement has automatically terminated on default or once possession proceedings have begun.

To find out more information and how to apply for a Time Order then visit the links below, they will take you to National Debtline, who have been giving free, impartial and confidential debt advice for over 25 years as an independent charity, dedicated to providing free debt advice by phone and online to people across the UK.

England & Wales

Time Order - Hire purchase or conditional

Time Order - Secured loan

Time Order - Unsecured credit agreement


Time Order

Alternatively call National Debt Line on 0808 808 4000 for more advice.

5.  Your options according to your problem with your Log Book Loan

Fallen behind with payments, in arrears, or think you are being threatened?

If you cannot catch up with your payments or the logbook lender is being unreasonable then think about applying for a Time Order. See more on how to do this above/below.

You may also be able to hand the car back to end the agreement. See more on this under section 4.8.12 of the Code of Practice.

Log Book Loan - Threatened with having the car repossessed?

You can serve an injunction on the logbook loan lender to prevent the sale of the vehicle at auction but you may need to get legal advice on how to do this. See 4.8.9 of the Code of Practice.

Another possible way to prevent the sale is take advantage of section 4.7.5 of the Code of Practice which states that ‘Members shall suspend, for a period of not less than 30 days, the active pursuit of recovery of a debt from a customer in default or payment difficulties under circumstances in which a bona fide debt advisor is assisting the customer in agreeing a repayment plan’.

Log Book Loan - Had the car repossessed, sold at auction and now being chased for a shortfall on the debt?

The debt collector/logbook loan lender has to work under the financial Conduct Authority (FCA) Debt Collection Guidelines, read them so that you know your consumer rights. Also read the new Code of Practice and in particular section 4.8 Enforcement of Debt Collection. Seek advice if you believe that the vehicle was sold at undervalue. Under certain circumstances the debt can be put on your home, if owned but where a member of the CCTA has obtained a charging order under 4.8.10 (a) or (b), they should not seek an order of the court for the sale of the debtor’s home.

Log Book Loan - High debt collection fees, for example £12 a phone call, even if missed, or £12 a letter, one a week?

Read section 4.8.5 of the New Codes of Practice –‘ Members shall not impose charges, of whatever nature, on customers who are in arrears unless the nature of those charges are disclosed at the Pre-contract stage and are limited to doing no more than covering the member’s costs.

Check the paper work you were given in the Pre - contractual information (PCI) (section 4.3 in the Code of Practice) to see whether it includes what fee and charges there will be and how they can be charged.

6.  Purchased a used car with an outstanding Log Book Loan?

Section 5 of the code ‘ THIRD PARTY PURCHASERS’ states that ’Members shall afford innocent purchasers of vehicles, that are subject to a Bill of Sale, the same protection as afforded under the Hire-Purchase Act 1964 Part III –“Title to Motor Vehicles on Hire-Purchase or Conditional Sale‟, but only insofar as title shall transfer to the innocent purchaser in the event that the Member failed to register his interest in that vehicle with a relevant Asset Finance Register Company within 24 hours of execution of the agreement.

Basically this means that if the logbook lender failed to register the loan on the vehicle you have purchased with an Asset Finance register such as HPI then you, the purchaser of the used car, may have new rights.

According to Graham Haxton-Bernard, head of legal and compliance at the CCTA who drafted the code of practice, this means that this translates as those who 'innocently purchase' a second-hand car in 'good faith' will gain the deeds to the car.

Depending on the circumstances of your purchase you may have clear title in law. Seek advice.

7. Affordability complaint - What is irresponsible / unaffordable lending?

If your creditor/lender fails to conduct proper in-depth affordability checks with you and you subsequently experience difficulty paying the loan back, for example missing essential payments on other household bills or taking out further loan(s) to pay back your first loan, or cutting back on your essential living costings, then this can be deemed as irresponsible / unaffordable lending.

Making a complaint

If you make a complaint to your creditor / lender then note there is no guarantee they will agree the loan was unaffordable, however the creditor / lender may subsequently agree to freeze the interest, reduce the amount you owe and / or reduce the amount you pay back each week or month.

That said you can lodge a complaint with your creditor / lender and if after eight weeks from registering the complaint you are not satisfied with the outcome you can go to the Financial Ombudsman Service (FOS). See section 8 below, 'Where to get help with a log book loan' for full contact details.

I may have giving the wrong information to my creditor / lender

You must always give correct and accurate information to any creditor / lender to enable them to verify your affordability. If you have given false information then do not expect support from the creditor / lender or the Financial Ombudsman Service (FOS).

Template letters

You will find a selection of template letters you can use, the one for the affordability complaint is the third one down from the menu on this page - Money Advice Service - Template letters 


8. Where to get help with a log book loan

Financial Ombudsman Service (FOS)

  • Monday to Friday - 8am to 6pm, Saturday - 9am to 1pm, 0800 023 4567
  • Free for people phoning from a "fixed line" (for example, a landline at home) 0300 123 9 123
  • Free for mobile-phone users who pay a monthly charge for calls to numbers starting 01 or 02
  • If calling from abroad then use: +44 20 7964 0500

The Financial Ombudsman Service will be happy to phone you back, if you're worried about the cost of calling them.

Consumer Protection Helpline - Citizens Advice consumer helpline

Contact the Consumer Protection Helpline (formerly known as Consumer Direct) if you need more help with a consumer problem. The law protects your consumer rights when you buy goods or services. Find out who to contact for consumer protection advice.

  • Citizens Advice consumer helpline: 03454 04 05 06
  • Textphone: 18001 03454 04 05 06
  • Monday to Friday, 9am to 5pm
  • To contact a Welsh-speaking adviser: 03454 04 05 05
  • Textphone to contact a Welsh-speaking adviser: 18001 03454 04 05 05
  • Closed on bank holidays

Calls to the helpline cost up to 9p per minute from a landline. If you're calling from a mobile, it'll cost between 3p and 55p per minute - if you have inclusive minutes, it's the same as calling a landline. Find out more about call charges on GOV.UK.

An adviser will answer your call as soon as possible, usually within a few minutes. Once you're speaking to an adviser your call should take an average of 8 to 10 minutes.

More details including contact on line can be found here Consumer Protection Rights 

Where can I get free debt advice and debt solutions with no fees?

You can either telephone DebtWizard on click on the following link to get details of other free debt advice organisations, including debt charities.

DebtWizard - 03339 870 180 
Monday to Thursday: 9.00am - 8.00pm, Friday 9.00am - 5.30pm

Take me to free debt advice agencies.

Have a question?

Need to ask a question about log book loans? If so then go to our The DebtWizard Debt Help Forum & IVA Forum







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