A Brief Guide to Secured Loans and Homeowner Loans.

A Secured Loan is where you, the borrower, will pledge some form of asset as collateral for the loan, in most cases the loan is secured against your property.

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Loans up to £100,000*

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Understanding Secured Loans and Homeowner Loans

In the current economic climate, unsecured loans are becoming increasingly difficult to obtain, if you are a homeowner, then a secured loan may be the best option, especially those looking for higher loan amounts of £15,000 and above.

When a bank agrees to lend money to a homeowner, especially those with a bad credit history, their risk is minimised as if you fall behind with your repayments, you could be in danger of losing your home.

Is there such a thing as the 'Best Secured Loan'?

Everybody wants to get the best rates and deal for their secured loan, truth is, interest rates change all the time. There are numerous lenders out there who will offer low rates of interest to entice new customers.

You should always shop around when evaluating your options, don’t take the first offer that comes along, and make sure you get the best secured loan for your circumstances.

How do I get the best deals?

As a broker ourselves, we work with other trusted brokers and direct lenders to provide you with an array of options for your secured loan.

It is our goal to provide our applicants with the finance that is right for them; we aim to safeguard you against taking out a secured loan from a provider that is not suitable.

What if I have bad credit? Are Secured Loans still available?

Even if you have suffered in the past with credit problems, many lenders will still be in a position to provide a secured loan.

Even if you have a bad credit history, a secured loan can be your best option due to several factors.

  • 1. As you are providing collateral for the loan, you are more likely to be accepted for a secured loan than for an unsecured loan.
  • 2. Again, as you are providing security, you are more probable to obtain a better interest rate than if you are taking out an unsecured loan with a bad credit history.
  • 3. The repayment terms can be spread over a longer period giving you lower monthly repayments compared to an unsecured loan.

Taking out a secured loan carries a long term commitment; your property is at risk if you do not maintain your repayments. The lender has the collateral of your property to fall back on if you default on the loan.

Be confident that you can meet the conditions of the loan, as mentioned, it is a long term commitment that requires a lot thought, and you don’t ever want to find yourself in a position where your home is at risk.

Advantages

  • As the loan is secured against your property, the lender may provide you with competitive rates, even if you have an adverse credit history.
  • Your monthly repayments could be lower in comparison to an equivalent unsecured loan.
  • This type of loan is ideal if you are looking to consolidate a number of existing unsecured debts or if you are planning any major home improvements.

Disadvantages

  • Secured loans are normally repaid over a longer term. If you are seeking a short term loan, this may not be the ideal option.
  • As the loan is secured against your property, your home may be repossessed if you do not keep up the repayments.
  • The loan term and interest rates will depend on the amount of equity you currently have in your property and the lenders assessment of your personal circumstances.

Loans up to £100,000*

Whatever your circumstances

  • Loans up to £100,000
  • Loans for any purpose
  • No complicated forms
  • No 'Up-Front' fees

Typical 18% APRC (secured)

Typical Example:
£14,500 over 6 years. Repaying £353.33 per month. Total Repayable £25,439.76. Annual interest rate is 18% variable.

WARNING - LATE REPAYMENTS CAN CAUSE YOU SERIOUS MONEY PROBLEMS. FOR HELP GO TO WWW.MONEYADVICESERVICE.ORG.UK

First Stop Evolution Money

*Unsecured loans are available to a maximum of £25,000. Loans of up to £100,000 may
be offered by the lenders subject to affordability and secured against your property.
Typical Example for illustration purposes only: £25,000 over 10 years with 7.8% APR, Total to repay: £35,664, Monthly Repayment: £297.20.
Overall cost for comparison is 5.5% APR typical. Overall cost for comparison for unsecured loans is 22.1% APR typical.
Unsecured Loan Typical Example for illustration purposes only: Borrowing £4,500 over 36 months. Repaying £219.55 per month.
Total repayable £7,903.80. Annual interest rate is 49.9% (variable).

This article is intended to provide information only, and does not constitute financial advice or assistance, without limitation, warranties as to satisfactory quality, fitness for purpose, accuracy or skill. The information contained in this article is generic and non-specific to your own individual circumstances or anyone else.

THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

WARNING - LATE REPAYMENTS CAN CAUSE YOU SERIOUS MONEY PROBLEMS. FOR HELP GO TO:

The Money Advice Service

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