Lenders make offers on the basis that, if you fail to meet the payments, they then have the right to repossess and sell your home or asset to cover what you owe.
Because your home or asset has been put up as collateral, lenders may offer lower interest rates than those you might see with other types of lending. They may also opt to lend to those with bad credit scores, who may struggle to get affordable unsecured personal loans. Secured loans are a much riskier option of borrowing.
Your asset could be repossessed if you fail to make payments on your secured loan
They may be available for people with poor or no credit history
Lower interest rates
You can potentially borrow more through a secured loan than through a unsecured personal loan
It is possible to pay off secured loans early but you may have to pay early repayment charges
All secured loans will give lenders the right to repossess your home if you fail to make repayments. The money from the property will be shared out among the lenders in the order that the loans were given.
If you’re struggling with existing debt at the moment, it could be beneficial to seek impartial debt help and advice.
Fresh Start UK has helped more than 12,000 people gain control of their finances and become debt-free. If you’re struggling with debt and finding it tough to keep up with your bills, speak to an advisor today.Get Started
Do you feel as though you need help with your finances? A debt management plan can help you do just that, reducing your stress and worry immediately.
As a leading debt management company, Fresh Start deals with thousands of cases each year and is able to provide our clients with confidential advice to prevent debts from becoming insurmountable. Get in touch with us today to find out more.
Money Helper has replaced the Money Advice Service and brings together the support and services of three government-backed financial guidance providers: the Money Advice Service, the Pensions Advisory Service and Pension Wise.