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Understanding Representative APR

If you want to know how much your logbook loan costs, one concept you need to fully understand is the Representative APR. APR stands for annual percentage rate, a concept that lenders use to advertise the total cost of a loan. It covers the interest rate and all other charges associated with the financial product.

For logbook loans, the average Representative APR is 400%, which is a steep price to pay for a loan. Thankfully, more and more lenders are now offering cheaper logbook loans to get ahead of the competition. To find an affordable deal, you’ll need to shop around for logbook loans with lower APRs.

While the APR is often adequate to determine the loan’s cost, it is important to remember that there is a difference between the representative APR and the actual APR of your logbook loan. When your lender advertises their offers at 400%, it doesn’t necessarily mean that you are going to get the 400% APR. The actual APR often varies from what was advertised. It can be lower or higher depending on your personal circumstance and the current rate in the market among other things. Click here for more info on APR.

In any case, the trick to getting the best end of the deal when applying for a logbook loan is to shop around for deals with the lowest APR. If you look in the right places, you should be able to find logbook loans with Representative APRs between 100 and 300%.

Naturally, the lower the APR is, the cheaper the loan will be. But again, remember that the representative APR is different from the actual APR. Rather than just look for logbook loan deals with the lowest APR, you’d also want to investigate your lender’s reputation. Call customer service if available and ask about hidden fees and more information on the actual APR. Better yet, read the fine print so you know everything about the cost of the loan before you ink any deal.