There are lots of different options when it comes to borrowing. In your search for the ideal loan you might have heard of secured loans. This kind of loan allows you to use your home as collateral to secure the loan. So what makes a secured loan a more favorable option compared to other types of loans?
For starters, a secured loan is much more readily available. It is often much easier to get such loans, instead of other unsecured loans. Lender will be happy to do business with borrowers who offer some form of collateral. This could be your home or some other property. As a borrower, this doesn’t mean you are locked into the demands of the lender either. There is a lot of competition in this market, so you can take your business to a secured loan provider you trust and respect. Appleloans are a specialised online loans provider focused on meeting the needs of the borrower. It is well worth the time to check the website to get an idea of how you can quickly and easily apply secured loan.
Secured loans can get you very favorable terms and conditions. As the collateral reduces the amount of risk a lender will be taking, the terms of the loan can be more flexible. So always try to negotiate to tweak the loan for your particular circumstances. For example, you might need to borrow a larger amount of money or require a longer time to pay it back. The lender would be able to adjust the terms to meet your requirements.
Your home holds a value, but for most people this equity is left idle. By utilising secured loans you can leverage the value of your property to your advantage. These loans let you meet your financial needs, without the need to sell off the property.
Another great feature of these loans is the lower rate of interest. The lowered risk to loan providers, affords you some of the lowest interests rates available. This is especially true if you have an excellent credit score. But don’t fret if your credit history isn’t very good. Even with a poor credit rating you can still get the loan, but the rates of interest will be a bit higher. Make sure you fully understand the concept behind interest rates, to avoid any confusion about the total amount you will have to repay. Use handy online loan calculators to figure out the details based on the APR of the loan.
Sometimes you need to borrow a large amount for a particular investment, project or need. Traditional loans often have quite a low limit to how much you can get (usually up 25,000 pounds). By putting forward some form of collateral you can arrange far greater sums that will sufficiently meet your needs.
AppleLoans is a good place to look for all your borrowing needs. Fill in the application form, and be on your way to getting a loan tailored for you.
Secured Loans : Definition and Facts
Many people don’t know that secured loans are also known as homeowner loans. Basically, this term is the one that describes a sum of money which you borrow from a lender, that is secured against your property. That property guarantees that you will pay the loan off.
The technique for securing the loan is also called the second-charge technique. This second charge actually lies behind the mortgage, and is held there on a first charge basis, which means that the property can go to a lender even if the mortgage hasn’t yet been paid off. The land registry always has this info written into it. One of the most established secured loan companies in the UK is Apple Loans. They can approve your credit in a matter of 60 minutes, and there are no upfront fees involved.
Secured loans are oftentimes used for things such as wedding, home improvements and travel. The less known fact is that they can’t be used for illegal purposes, nor commercial gain. Some companies allow you to use them for commercial gain, but the interest rates skyrocket in this case.
The way of repaying the loan varies from company to company (you can even get them in the bank, but the banks are very slow, and their interest rates are not that good either; in fact, if you have a bad credit profile with them, the chance of getting the loan is actually very slim), but the general payment goes like this: you are obliged to regular monthly payments in the span of 5-25 years. The less time you take for repaying the loan, the bigger your monthly fees are going to be. However, in the long term, this could save you a lot of money, because the interest rates are calculated on a monthly basis.
Who benefits the most from these loans? Well, to tell you the truth, every homeowner (mortgage payers included) can benefit from a secured loan if he or she wants to borrow a bigger sum of money. I’m talking about up to £500k. The other prerequisite is that you can use your home as a security measure because you have equity in it.
Some tips before you consider getting a secured loan:
The Consumer Credit act (1974) covers the second charge loans. First charge loans are regulated (in the UK) by the FCA.
Make sure to calculate your costs. This is especially important when deciding on the time frame to pay the loan off. For example, if you are sure that it won’t make a lot of pressure for your regular household expenses, you might want to go for a short-term approach. On the other hand, if you think that you will feel the pressure, you can decide to go for a long-term payoff approach. In this case, you will pay more money, but this amount is going to be spread over years, so you won’t feel it that much.
If you have multiple avenues of debts, you can consider taking a secured debt consolidation loan. This is very useful when you need to gather all the debts into one debt only. Not only is it easier to manage, but it also relieves you from pressure and stress.
I would say that the biggest advantage of the secured loan is the fact that you can borrow a lot more money. Unsecured loan limits usually top off at £25000, while you can borrow up to 4 times more if you decide to secure it. However, the downside is that your property becomes pressured, and the lender can take you to the court for a repossession.
Easy Financing with Secured Loans
It is a type of loan that is backed by collateral to protect the lender from risk. What do we mean by collateral? This can be any property or other valuable asset you own that is pledged as security for the loan. The only major disadvantage of a secured loan is the risk on your part. In the unfortunate scenario of not being able to pay back the amount borrowed, you would lose ownership of whatever collateral that was agreed upon. You should be certain that you can keep up with the repayments and know exactly how much is expected before signing the agreement. The good news is that really is the only downside of getting such a loan.
There are many positive aspects to these loans. Before getting into the details, here is an important question. What factor prevents many people from being able to borrow money?
A poor credit rating is the biggest hurdle for many prospective borrowers. Your past credit history can completely ruin your chances of getting a loan. Lenders usually avoid anyone who doesn’t have a positive credit report.
You will be happy to know that this only applies for a typical unsecured loan. By providing a security for the amount borrowed, you can bypass the harsh restrictions of other loans. Be aware that while with a bad credit score you can get the loan, it is likely the rate of interest will be a bit higher to reflect your situation. Loan providers such as AppleLoans will conduct a soft credit search on your behalf, which leaves no footprint. Visit appleloans.co.uk for more details on their services.
The amount you can borrow is higher when you secure the loan. Most secured loans in the UK range from around 12,000 to 100,000 pounds. This is usually enough for the most common purposes. More can be borrowed, but only if the collateral is of sufficient value. It isn’t normally recommended to borrowing too much as the repayment burden can become too much to bear. Of course if you have a reliable source of income, a higher sum of money can be borrowed. This would have to be negotiated with the loan provider and would also depend on the collateral valuation.
Another positive feature is the much lower rate of interest. Since you have lowered the risk for the lender, the interest rate also falls. If you can make a strong case the terms and conditions of the loan plan can be adjusted in your favor. Other than having a good credit rating, there is another way of making the loan cheaper. Increasing the repayment period allows for a decrease in the interest rate.
These loans can be used for either personal or business needs. Some common reasons for getting a loan include: home improvements, purchasing a car, debt consolidation, paying for a holiday, wedding expenses, launching a business venture or expanding an existing company.