Looking to Take Out a Secured Loan? Read This:

A secured loan, also known as a homeowner loan, uses your property as security against the amount you are looking to borrow. This can be an option if you need to borrow a large sum of money (£25,000+) and have a poor credit rating but it’s important to understand the risks when opting for this type of loan - if you fail to keep up with the repayments, the lender could seize your property.

What to consider when taking out a secured loan?

Before taking out a secured loan, it is worth considering alternative options where the consequences of failed payments are not as severe. If you decide a secured loan is the best way to go however, it is important to assess how affordable the loan repayments will be. The consequences of not keeping up with repayments can vary, depending on how far behind you are on the repayment and it could impact your credit score, and most importantly, the ownership of your home.

Not all secured loan offers are the same and your personal circumstances will determine the terms of your loan. Here are some of the factors lenders take into consideration when looking at your loan application:

Your income.

Your credit score.

Existing credit commitments.

The amount of equity available in your property .

The interest rate you are offered can vary depending on your credit score and your property could be repossessed if you fail to make your repayments.