Secured finance interest rates vary considerably and while you could take a loan from the high street lender usually the rates are not as good as those you are able to find online. By going with a specialist broker, you can save not only money, but also a great deal of time and effort. They are able to look around with the whole of the UK marketplace to find you competitive rates of interest.
There are many advantages to taking out secured finance. One of them is that you able to spread the cost of the borrowing over up to 25 years and you are able to borrow a larger sum of money than with an unsecured loan. Some lenders will lend up to £500,000. The biggest downside is the fact that you will have to secure your home against the loan.
Secured loans can be taken out for many reasons. Some of the most popular include paying for home improvements, unexpected repairs, a brand new car, or for consolidating your existing debts into one single payment. A consolidation loan can help you to get out of debt. It allows you to take all of your existing debts such as credit cards and loans and combine them. You then take out one secured loan and if you have got a low rate of interest then you will save money each month while at the same time becoming debt free within the time frame of the loan.
Secured loans are also useful for those who have a poor credit rating. The credit rating is the first thing that all lenders take into account and if yours is below par then you could be turned down. A secured loan can help those with poor credit history to rebuild it providing they repay the loan without any problems on time.
The amount that you are able to borrow will be dependent on the equity you may have in your home. This is worked out be deducting what is left on the mortgage from the value of your home. The majority of lenders would allow you to borrow up to 100% of the spare equity. Some will go as far as allowing you to borrow up to 125% of it but you must have a good credit rating and show ability to repay the loan. While you can spread the cost of the loan out over many years you do have to remember that while you do owe money, your home is at risk of being repossessed by the lender is you should default on the loan.
Always consider before taking out secured finance that your circumstances could change in the future, especially so if the loan is taken over a long period. You have to be able to maintain the repayments even during any change in your lifestyle so consider protecting the borrowing with loan insurance. You also have to consider that spreading the cost over many years would keep the monthly repayments down you but you would be paying more out for the loan in the long run with the interest. Always read the terms and conditions of any loan you are considering applying for. A specialist website should be able to supply the key facts of the loan with the quote and these should be gone over with a fine tooth-comb before signing.
Resource: http://www.isnare.com/?aid=240736&ca=Finances
No comments:
Post a Comment