Secured home owner loans tend to be for larger sums of money normally over £3000. Unsecured personal loans may be available for less and up to £25,000; they do not require the security of your property. Secured loans can be easier to obtain because of the reduced risk for the lender, even if you have a poor credit history or have special status e.g. self-employed. Secured loans or home equity loans require the borrower to provide security; this will be the borrowers property despite whether all or only part of the property is owned. How much equity you own in a property will greatly determine your level of borrowing. Some UK lenders offer secured loans of up to £100,000 depending on the borrowers circumstances.

Factors influencing your level of borrowing on a secured loan:

1. Equity in your property
2. Financial position
3. Credit rating

Effects your circumstances may have on your loan:

1. Amount you’re allowed to borrow
2. Payment term (most secured loans are repaid over 5 –25 years)
3. APR Annual percentage rate

Compare APR’s that lenders offer, as this can be a good indicator of how competitive they are.

Consumer credit act 1974

The terms of a loan agreement are binding so read them carefully before you sign. The lender must give you a consideration period of seven days; this can give the borrower valuable time to fully understand the implications of obtaining the loan before making an informed decision.

The payment term is discussed and agreed during the offer period; loans can be repaid over a few or many years. Examine each lenders terms and conditions, also their policy for early repayments. It is important to consider these issues carefully; there are normally early repayment fees that compensate the lender for interest payments that may be lost due to early repayment.

The information on this website is not intended as advice, it is purely for information purposes only. If you would like financial advice please contact us so that we can take your individual circumstances into consideration.

We offer free independent financial advice from an impartial qualified financial adviser about loans.

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See also:
Unsecured Personnel Loans