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What is a Secured Loan?

A secured loan is a personal loan which is generally consigned to home owners. In a typical secured loan, the home is used as collateral against the loan, meaning that should you be unable to maintain the loan repayments, your home will be at risk.

As the home is being used as collateral, a secured personal loan presents a greater risk than an unsecured personal loan. In many cases however, a secured  personal loan presents greater benefits.

What are the Benefits of a Secured Loan?

The main benefit of a secured personal loan is that, typically, they offer a cheaper interest rate than unsecured loans, the cheaper interest rate reflects the reduced risk involved for a loan company in providing a secured loan.

Approval for secured loans tends to be easier to come by. With a secured personal loan, you are essentially betting your house that you can repay the loan, which are good odds for the loan company, as a result they are more likely to approve you.

What are Secured Loans used for?

Secured personal loans can be used for a variety of reasons, including:

home improvements - a loan is taken out to carry out home improvements, with the aim of adding to the overall value of the home.

debt consolidation - a loan is taken out to pay off existing debt, thus consolidating the debt into one manageable, longer-term loan repayment.

mortgage arrears - a loan is taken out to cover arrears in mortgage repayments, or to convert current mortgage repayments into a longer-term, more manageable loan repayment.

car finance - a loan is taken out to finance the purchase of a new car, as the terms of a secured personal loan are more attractive than other car finance options.

adverse credit - a loan is taken out with a specialist loan company, who, despite previous adverse credit issues and problems being approved for a personal loan with other loan companies, are willing to approve a secured personal loan.

UK Loan 24
Great Rates for all circumstances