Secured loans, as is fairly obviously stated are forms of loans that require some form of security. There are a variety of different forms of secured loans, but today it is the homeowner version of secured loan that we are considering.
Secured loans can be guaranteed by the equity on your main residence or even on your holiday home. However not many people are lucky enough to own a second home.As these are secured loans non homeowners cannot apply, and if a tenant requires a loan, the only option is an unsecured loan. Unsecured loans are few and far between at present even for homeowners.
A secured loan is an excellent way for a homeowner to borrow for almost any purpose whether the purpose is vehicle purchase, home improvements of all kinds such as to build a conservatory, a garage a new kitchen, etc. You can even go on a luxury holiday anywhere in the world with your secured loan funds. For those thinking about getting married you can arrange your dream wedding and pay for it with your secured loan.
A secured loan is secured against the equity on your property. Equity is the difference between the value of your property and the out standing mortgage balance. This means that if your home is worth say 250,000 and the mortgage balance is 160,000 your equity would be 90,000.
So saying it is not possible since the advent of the recession to borrow up to 100% of the value of the property as it was until 2007. Then there was even the 125% equity plan where by it was possible to borrow up to 25% above the value of the property.
Now the maximum equity that any secured loan lender takes into account is 70% for a self employed secured loan borrower, and 80% if the prospective secured loan applicant is employed. Therefore based on the previous example an employed person could obtain a secured loan of 40,000 maximum, while the maximum available secured loan for a self employed applicant would only be 15,000.
For homeowners with bad credit secured loans are still out there although with much tighter underwriting that before this most awful credit crunch. Before the crunch even homeowners with an extremely bad credit profile could obtain a secured loan up to 75% LTV.
Prior to the credit crunch homeowners facing the repossession of their home could even be saved from this fate at the very last moment by obtaining a secured loan to save the day.Repossession is a terrible thing and sometimes it can happen due to the homeowner having suffered from ill health or redundancy.
Even nowadays bad credit secured loans are there but at a very restricted equity margin. The equity taken into account by bad credit secured loan lenders is 60% if the adverse is not too severe and 50% in extreme cases for homeowners with months and months arrears on their mortgage, defaults, county court judgements, etc. There are now only two secured loan lenders who grant this 50% LTV secured loan plan and one of these secured loan lenders is First European Securities.
If a homeowner has extremely bad credit the biggest secured loan that these two bad credit secured loan lenders advance is 25,0000 or there abouts. 50% LTV is very tight but if a homeowner has sufficient equity a bad credit secured loan at even 25,000 could help him out.
If a homeowner has bad credit he can still obtain a secured loan but not as readily now as before the recession. - 30462
Secured loans can be guaranteed by the equity on your main residence or even on your holiday home. However not many people are lucky enough to own a second home.As these are secured loans non homeowners cannot apply, and if a tenant requires a loan, the only option is an unsecured loan. Unsecured loans are few and far between at present even for homeowners.
A secured loan is an excellent way for a homeowner to borrow for almost any purpose whether the purpose is vehicle purchase, home improvements of all kinds such as to build a conservatory, a garage a new kitchen, etc. You can even go on a luxury holiday anywhere in the world with your secured loan funds. For those thinking about getting married you can arrange your dream wedding and pay for it with your secured loan.
A secured loan is secured against the equity on your property. Equity is the difference between the value of your property and the out standing mortgage balance. This means that if your home is worth say 250,000 and the mortgage balance is 160,000 your equity would be 90,000.
So saying it is not possible since the advent of the recession to borrow up to 100% of the value of the property as it was until 2007. Then there was even the 125% equity plan where by it was possible to borrow up to 25% above the value of the property.
Now the maximum equity that any secured loan lender takes into account is 70% for a self employed secured loan borrower, and 80% if the prospective secured loan applicant is employed. Therefore based on the previous example an employed person could obtain a secured loan of 40,000 maximum, while the maximum available secured loan for a self employed applicant would only be 15,000.
For homeowners with bad credit secured loans are still out there although with much tighter underwriting that before this most awful credit crunch. Before the crunch even homeowners with an extremely bad credit profile could obtain a secured loan up to 75% LTV.
Prior to the credit crunch homeowners facing the repossession of their home could even be saved from this fate at the very last moment by obtaining a secured loan to save the day.Repossession is a terrible thing and sometimes it can happen due to the homeowner having suffered from ill health or redundancy.
Even nowadays bad credit secured loans are there but at a very restricted equity margin. The equity taken into account by bad credit secured loan lenders is 60% if the adverse is not too severe and 50% in extreme cases for homeowners with months and months arrears on their mortgage, defaults, county court judgements, etc. There are now only two secured loan lenders who grant this 50% LTV secured loan plan and one of these secured loan lenders is First European Securities.
If a homeowner has extremely bad credit the biggest secured loan that these two bad credit secured loan lenders advance is 25,0000 or there abouts. 50% LTV is very tight but if a homeowner has sufficient equity a bad credit secured loan at even 25,000 could help him out.
If a homeowner has bad credit he can still obtain a secured loan but not as readily now as before the recession. - 30462
About the Author:
Champion Finance has been established since 1985. They arrange secured loans .Also available are whole of the market remortgages .
No comments:
Post a Comment