StepChange Debt Charity response to the Law Commission’s recommendations on logbook loans

12 September 2016

In response to the Law Commission’s recommendations on protecting consumers from unfair logbook loans, Peter Tutton, Head of Policy at StepChange Debt Charity, said:

“Legislation on logbook loans is over a century old and not fit for purpose, so it is good to see action being taken. Logbook loans can cause significant harm and the current protections are wholly inadequate.

“We need effective, modern consumer protection and these recommendations are a positive step forward. However, in their current form, they will not provide adequate protection and the people who will suffer are the ones that need it the most.

“If people have to actively opt-in to receive protection from the courts against lenders repossessing their car, our evidence suggests it will not work. It requires too much proactivity and understanding from financially vulnerable people who may not even feel able to open their mail. It also requires too little from sub-prime lenders seeking to take away a car that could be essential for work or family life.”