A Secured Loan Could Save You Money

What is a Secured Loan?

A secured loan is any loan that is secured on your home or property. It is any loan which requires you to provide the lender with some form of security other than just a promise to pay. The security will be your property or home. The property may be mortgaged or owned outright.

If you agree to a secured loan on your home, you should remember that, although the property remains in your possession, it can be repossessed by the lender if the loan and the interest are not paid according to the agreed terms. The lender will then sell the property in order to recover the money you borrowed plus any additional costs incurred in recovering the money.

Secured Loan Benefits

In many instances secured loans can be repaid over a longer period with a lower monthly repayment. The interest rate will be lower on a secured loan than on a comparable unsecured loan. A secured loan may also offer more flexible repayment periods.

1. If you're a homeowner, you may get a lower rate through a secured loan using your property as security. By taking out a secured loan, you are agreeing to allow the forced sale (foreclosure or repossession) of the asset in order to pay back the loan. The risk to the lender is reduced so the interest rate offered is lower. This is why secured loans tend to be cheaper than unsecured loans and other forms of borrowing. The lender has the added benefit of security, which provides protection in the event of your inability to repay.

2. Secured loans are more easily accessible to those with a poor credit record. This means that persons who are self-employed, or who have recently changed jobs, or who have adverse credit (ccjs, arrears, defaults, etc.) can take out a secured loan.

3. You can borrow larger amounts and repay over a longer period. The amount available usually ranges from £3,000 to £50,000, although some lenders will consider lending more. Compare this to unsecured loans where you're only allowed to borrow up to £25,000. If you wish to borrow a larger amount or if you require a longer period in which to repay the loan, secured loans may be the most suitable for you.

4. You can consolidate more expensive borrowings into a single much cheaper monthly payment. You may choose to take out a secured loan in order to consolidate debts and replace high-interest loans with a low-rate loan. The loans being consolidated may include higher purchase loans, unsecured loans and credit cards.

Useful Points to Remember

Before you take out a secured loan, make sure that you can afford the monthly repayments. Also, read the loan agreement carefully and pay particular attention to the rate of interest required, the term of the loan, the repayments required and the total amount payable. If you fail to repay the loan, the lender may repossess your property or home and sell it to repay the loan. If you borrow money using a mortgage as security you are agreeing that the lender can claim the mortgaged property if you fail to keep to the agreement. Your home is at risk if you do not keep up repayments on a mortgage or other loan secured on it. You can read some more articles about secured loans at: http://www.commercial-mortgage-guide.o rg.uk/loanguide/

© Copyright 2005, Bwalya Mwaba writes for the The Commercial Mortgage Guide. Visit our website for mortgage related news, articles, tools and more: http://www.commercial-mortgage-guide.org.uk/ .

This article may be reprinted as long as all the above links are active and clickable and the author box (byline) is not edited.

---

Secured Loans - UK Overview

Borrowing money has become more and more popular in the... Read More

Online Loans: The Easy Way to Apply

The internet is a great place to find the right... Read More

Filling Out The Loan Application

1. Property information. The application begins with a section on... Read More

Loan Basics

There is more than one type of loan. Depending upon... Read More

No Credit Check Personal Loans - If You Need Fast Cash, A PayDay Loan Online Is a Very Quick Process

Online payday loans can get you fast cash through a... Read More

Bridging Loans - Fulfilling Financial Shortfall between Real Estate Transactions

You are trying to buy a new property and selling... Read More

Understanding Secured Loans

A secured loan is any loan that is secured on... Read More

Faxless Payday & Cash Advance Loans - Fast Cash, No Faxing Loans, The Easiest Payday Loan Process

If you are in a hurry for a payday loan,... Read More

A Guide to UK Secured Homeowner Loans

Trying to find good UK secured homeowner loans might seem... Read More

Bad Credit Personal Loans ? Pertinent Pedestal for a Financial Resumption

In the arena of loan borrowing, there is hardly an... Read More

Your Home Can Act As Carriage For Car Loans; Do You Know The Term For That? Secured Car Loans

Since the invention of the first self propelled car by... Read More

Understanding Personal Loans, Cash Advances and Payday Loans

Have you ever been short on cash? Has an unforeseen... Read More

Relax, Unwind, and Enjoy With American One Secured Personal Loans

Secured Personal Loans are those loans against which you don't... Read More

Compare Payday Loan or Cash Advance Lenders Online Before You Borrow

Comparing payday loan lenders, also called cash advance lenders, online... Read More

Finding a Cheap Secured Loan

In a time when everything seems expensive, it might seem... Read More

About Personal Loans

What are personal loans? They are unsecured loans that a... Read More

Cash Advance Loans Online - A Great Way to Make it Until Your Next Pay Day

A payday advance is a loan obtained to cover unexpected... Read More

Best Car Loan Rates - Tips To Getting a Low Auto Loan Rate Online

Online car loan shopping practically guarantees that you are getting... Read More

What is a Homeowner Loan?

A Homeowner Loan is a way of using the equity... Read More

Cosmetic Surgery Loans ? Discovering How It Feels to Look Your Best

Market research of UK's cosmetic surgery ascertains the fact that... Read More

Military Payday Loans ? When?s The Best Time To Avail Of These?

What are the opportune times to avail of military payday... Read More

A Guide to Looking for Cheap Online Loans

Cheap online loans may seem hard to come by, but... Read More

Loan Officer Marketing - The Power of Positioning

How do you build a marketing strategy that can have... Read More

Guide to Personal Secured Loans

Here is a useful guide to personal secured loans. A... Read More

Refinancing Your Auto Loan

Refinancing your loan is one of the best kept secrets... Read More

Financial Aid Options

Before entering college, you may find yourself pondering exactly how... Read More

Should You Get A Pay Day Loan?

Whether you have good credit, bad credit or no credit,... Read More

Simple Tips On Getting Your Loan

So, you want to get a loan?Here are some simple... Read More

Risk It With A Bridging Loan?

How many times have you been casually going about your... Read More

Secrets & Benefits of Secured Loans

Borrowing money has become more and more popular in the... Read More

No Money Down Loans

You want to buy a home but you do not... Read More

The Wonders of Compound Interest

Albert Einstein called compound interest "the greatest invention of all... Read More

The Ins and Outs of Loans for Military

Under the microscope loans for military really are different from... Read More