Secured Home Loans

Depending on the individual the product is aimed at, the phrase secured loan has a different meaning. A secured loan offered to a company, for example, is slightly different from a secured loan offered to a member of the public. Want to learn more? visit us.

A secured loan involves the offering of some form of collateral for the loan by the borrower. For instance, a business owner seeking to take out a secured loan would usually have to offer their company an asset to act as the collateral for the loan, such as machinery that the company might own.

What is usually offered to the general public is a secured home loan, the lender would expect the prospective customer to provide some form of asset to act as collateral for the advance of the loan in most cases there private property. The principles of a secured loan are the same as a mortgage; by placing a charge against the title number in the land registry, the lender will register an interest in the property.

A secured home loan carries less risk to a lender by offering the lender some form of collateral because the lender can take possession of the property and has the power to sell the asset in order to redeem the outstanding debt owed in the worst-case scenario of the borrower failing to repay the loan. When considering a secured loan, this factor must be taken into account, as there is a possibility that your home may be repossessed if your repayments are not kept up to date.

The plus side to a secured home loan [] is by providing the lender with some form of collateral means less risk, and potential risk being the most important factor to a lender when deciding rates of interest given to a customer often secured home loans come with lower rate of interest compared to unsecured loan. Other benefits of secured loans over unsecured finance are that you can borrower larger amounts of money, typically the maximum amount someone can get on an unsecured basis is around £ 15000 while in some cases it is possible to obtain up to £ 100,000 with a secured home loan.

The time it takes to repay the loan also varies between an unsecured loan and a secured home loan, typically 7 years is the maximum term you could borrow money on an unsecured basis, while it is possible to repay the loan up to 25 years with a secured home loan.

When considering an applicant for a secured home loan, the primary factor that a lender will take into account is

1) They are owners of a home.

2) Over 18 years of age

3) Have a certain form of income

4) Have equity in there property.