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May 22, 2013

A Guide to Secured Loans

Filed under: Finance — Tags: — admin @ 11:49 am

A Secured Loan is any loan that requires the borrower to present the lender with some type of collateral or “security”. With Secured Loans, the security will be the borrower’s property, whether it is mortgaged, remortgaged or fully owned. Loans secured against a property that has already been mortgaged are known as “second charges”, and loans secured against a property fully owned without an existing prior mortgage are deemed as “first charges”.

Secured Loans are an ideal solution for homeowners who have recently been refused a personal loan or for home owners wanting to borrow a larger loan amount.

Secured Home Owner Loans are available in varying amounts with a variety of different purposes. The amount available usually ranges from £5,000 to over £75,000. When you receive a Secured Loan, the repayments are made monthly over a period agreed in the beginning between you and your lender, which is generally between three years and twenty five years. There can even be a rebate for early settlement of your loan, depending on your criteria.

Which Loan Should I Choose?

Usually, Secured Loans are easier to obtain than unsecured loans. Because the lender has the ability to use your home as security, they will regard a secured loan as “lower risk”, if ever the inability to make repayment. In addition, those who are self-employed, have adverse credit, ccj’s, or recently changed jobs can easily take out a loan. A Secured Loan offers you the ability to borrow larger amounts or request a longer repayment period.

An Unsecured Loan is called such because the lender doesn’t require the security of your home for the loan. You will usually be offered an interest rate or APR based upon your circumstances and the amount you would like to borrow. Depending on the lender, you may not be able to use your Unsecured Loan for certain purposes such as business or speculative reasons. Typically, with an unsecured loan you may not be offered as large an amount as a Secured Loan, and the APR may be higher. Simply ask one of our friendly lending representatives the conditions of your Unsecured Loan

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