What Are Secured Loans?

Secured Vs Personal (Unsecured) Loans

You'll have heard about both secured loans and personal loans, so why not compare the difference for yourself. Do you know the differences, what the pros and cons of taking out both these types of credit are?

There should be a simple rule about credit - if you can't afford it - you won't get it! But there hasn't been this rule - so all sorts of people have taken out secured loans or personal loans without the lender really checking whether they can or cannot afford the repayments.

In short, the difference between personal loans and secured loans is simple - secured loans require a security - usually a house - that can be used to pay off the loan should you default on payment. A personal loan is unsecured, more risky for the lender and therefor usually more expensive to borrow.

What About Secured Loan Rates?

For many people, secured loans are a way to gain access to an affordable route to borrowing money (or raise some finance) based mostly on the equity that their house has. The biggest draw back with secured loans is the fact that if you start missing payments and can't afford repayments, then you may lose your home as the lender will seek to get all their money back.

You can access a range of great rates direct from leading UK providers. With secured loans you are guaranteed a best rate loan as these are available only to homeowners as the lenders risk is offset by taking a charge (securing) against your home.

So it goes without saying there's a whole range of things that you need to consider before you sign on the dotted line - most of which should be about ensuring you check you can afford repayments and is taking out a loan really necessary in the grand scheme of things - could you wait a few months and do without it? Remember you are also paying for the privilege of borrowing this money!

What Things To Consider With Secured Loans

So the following points should be considered :

•     Compare secured loans direct from as many leading providers to get the best rates
•     Ensure you can easily afford the repayments
•     Make sure you are comfortable with repayment periods
•     Finally, make sure you ned to borrow the money

Check Why You Want A Secured Loan

So are you choosing a secured loan UK provider right now? Do you need help? Do you fully understand the difference between secured and unsecured? These and other questions are listed below to help you make sense and find out more before you apply.

Typical secured loans applications :

•     Look for between £10,000 and £250,000 to borrow
•     Require your property as security
•     Have no initial set up costs
•     Pay a lower APR than personal
•     Opt for longer repayment periods up to 25 years

Payment Protection?

Did you know that secured loans payment protection is a very specific type of insurance to ensure that you can continue to pay your loan even when you are ill? Did you know that a lot of people take out loans payment protection insurance with no hope of ever being able to claim against that insurance!!!

Secured loans payment protection, that's offered when you sign up for your loan, means that you can still make payments against your loans when you lose income due to an accident, sickness or even unemployment. It's expensive, but it may help make sure you don't lose your home - right?

There is a ton of small print with all loans payment protection plans, so always always check first.