Secured loans are only available to homeowners. These loans are secured against the equity in the property. A mortgage is a secured loan and is normally referred to as a first charge. A second charge secured loan is often a useful way to borrow money against the equity in a property as the lender has the security of the equity in the property. That means they will often consider loans for homeowners who are traditionally regarded as a higher risk and perhaps have tried and failed in an unsecured loan. These homeowners could be self employed, have recently changed jobs, or perhaps had credit problems in the past.

For many homeowners secured loans offer an affordable and effective way to borrow money and raise finance which could be used to consolidate existing loan, credit and store card balances into one lower monthly repayment, maybe carry out home improvements, change the car for a newer more reliable model, almost any purpose.

A secured loan allows homeowners to unlock the equity in their homes without the need to actually sell their property and move. Equity in a property is calculated by subtracting the mortgage amount outstanding on the home from the market value. For example if the property value is £100,000 and the mortgage balance is £70,000 then the equity is £30,000.

Finding the best loan can be difficult as there are many factors for the lender to consider - the amount that can be borrowed, the repayment term available, the annual percentage rate (APR), the value of the home, ability to repay, and the applicant’s personal circumstances to name but a few. Secured loans offer many advantages over unsecured loans which normally limit the amount that can be borrowed to £25,000. Depending on the homeowner’s situation (if they meet the criteria) they could borrow up to £250,000 with a secured loan and can usually opt to repay the loan over a longer repayment period up to 25 years compared to the normal maximum of 7 years for an unsecured loan. A secured loan allows homeowners to reduce monthly repayments by taking the loan over a longer period than would be possible with an unsecured loan.

Secured loans offer many benefits over unsecured loans but when considering taking out a secured loan you should consider carefully how much money you actually need as it is very easy to take more than required. These loans are secured on the home (like a mortgage) and it is important that everything is carefully considered before taking on extra borrowing as failure to keep up the new loan repayments could result in the property being repossessed. Homeowners should consider some form of payment protection insurance which would cover the loan payments if they were unable to make repayments due to accident, illness, or redundancy. It is important that homeowners are able to afford the new loan payment, without stretching their finances as changes to the interest rates could affect the cost of the monthly payments. The monthly payment could increase or decrease as is the case with mortgage payments.

A point to consider is the longer the loan term the higher amount of interest will be repaid. Homeowners should try to set the time to repay this new loan over as short a period as comfortably possible but ensure they allow a cushion to cover any increases in interest rates. We offer a free service to find homeowners the best loan quotes, and will compare quotes from various lenders. Complete our short enquiry form NOW with no obligation and allow us to find you the loan you require.

Try our secured loan repayment calculator. Loan secured homeowner is part of Lothian Finance who are based in Edinburgh. They have helped many homeowners obtain loans since they started in 1994 When they receive your enquiry one of their experienced advisers will telephone you to discuss your options.

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.