What is a secured loan?

What is a Secured Loan?

A secured loan is a loan which uses your property as security for a loan. Unsecured loans tend to be for smaller amounts over 3-5 years and from around £500 up to as much as £25,000 (which is rare and only usually done if the applicant has a perfect rating and is a homeowner ).

Secured loans are normally for larger amount from around five or ten thousands pounds up to as much £100,000 and sometimes even more.

Secured Loans are normally paid over a longer period of time from five up to thirty years.

Therefore, secured homeowner loans are ideal for those wishing to borrow large amounts for things such as home improvement or debt consolidation. They are particularly useful for debt consolidation because the monthly payments can sometimes be up to 50% less each month meaning that your debt will be much easier to manage!

Bear in mind though, that extending the time it takes to pay the loan off means that you will be paying more back. However, if this makes day-to-day life much easier then this makes it worthwhile.

It is also important to remember, that your house can be at risk if you fall to far behind with the repayments. If you do default on secured loan payments, it is essential you talk to your lender. They will do whatever they can to help you. The last thing they want to do is repossess your property!