Secured Loans : Loans you Procure, Thanks to your Home

By: Jack Watson

If you have property, say your own home in UK, you are entitled to a big privilege. You can avail to secured loans. The sheer number of benefits this type of loan provides to you makes it a very desirable form of loan. These loans require you to pledge a collateral. This collateral is the security, usually your property, such as your home that you keep with the lender till the time you repay the loan amount to the lender along with the interest as applicable. And in case you, as the borrower of the loan, are unable to repay the loan amount within the stipulated time, your property stands the risk of repossession by the lender to recover the dues.

On the face of it, this may sound like big risk.

However, the risk is minimal when we consider the terms and conditions applicable in secured loans which are rather much flexible. As compared to any other loan, these loans are not only offered at a much lower rate of interest, but also at much flexible period of repayment. And in case, you have an excellent credit history, you can avail to loans at the lowest rate of interest possible. The low rate of APR (Annual Percentage Rate) and the flexible repayment period combine together to bring your monthly instalments to the most affordable level. Not only this, you can also avail to a good amount of cash as per the equity on your home. At most times, it can be up to 125 % LTV (Loan to Value) or the value of your home equity. To calculate the home equity, the lender carries out a legal procedure, that is evaluation of your property with the help of financial experts.

Secured Loans are the much preferred means of loan transaction in the United Kingdom, because of the benefits for the borrowers and the security factor for the lender. Apart from usual needs as financing your different plans, you can use these loans for many other profitable deals. If you have many previous debts, and you wish to consolidate them into one loan to bring down the interest rate as well as to eliminate the headache of paying many lenders, secured consolidation loan can again be a very profitable proposition.

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