Secured loans

What is a secured loan?

Simply put, it is a loan only available to property owners (or mortgage holders), where the lender can forcibly sell your house to get its money back if you can't repay. The 'secured' bit means the lender gets 'security' not you, as if there are problems, they can repossess your home.

Why would anyone want a Secured Loan?

Easier to obtain

Unsecured loans are almost always cheaper for those with decent credit scores, but secured loans provide lenders with, well… security, so they're more willing to lend to poor credit scorers.


Should you have a secured loan?


If it is actually cheaper for you...then yes.

With all the recent mortgage lender criteria changes, many people have found themselves as "mortgage prisoners" - this means that due to this new criteria, if they were applying for the mortgage they already have, they would be refused.

This could be because of revised lending amounts or because their current mortgage is 'interest only' - you could also be a voluntary prisoner if your current mortgage rate is so low, you would be nuts to change.

A secured loan could be a valuable 'top up' loan tool, working to your advantage.

Big borrowing is possible

The maximum unsecured loan is £35,000 yet secured loans can be £75,000.

Borrowing over a longer period

Secured lenders prefer loans to last longer to help offset hefty set-up costs, usually from 5 to 25 years.

Unsecured lending is usually 1 to 7 years.

Borrowing for longer does reduce the monthly repayments, but substantially increases the total interest repaid.

 

 

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
OR ANY OTHER DEBT SECURED AGAINST IT. THERE MAY BE A FEE FOR MORTGAGE ADVICE,
THE PRECISE AMOUNT WILL DEPEND ON YOUR CIRCUMSTANCES, OUR TYPICAL FEE IS £295

Mortgage & More is registered in the UK: 06437752 ~ Authorised and regulated by the Financial Conduct Authority FRN: 651274 ~ 9 Balas Drive, Sittingbourne, Kent ME10 5AS - 01634 235132