|
Analysts Say Secured Loans Are Now A Good Option For Homeowners |
Written by Phil Benson
Friday, 04 July 2008
|
In spite of the risks that come along with borrowing against your home, they may be a viable option if people are looking for money according analysts at price comparison website moneysupermarket.com . With secured loan interest rates falling, it makes this type of borrowing more attractive to homeowners who are looking at ways to raise extra cash. An increasing number of consumers are now turning to this type of lending and are willing to put their properties up as security because unsecured credit, such as personal loans and credit cards is becoming more expensive and harder to find. Head of loans and debt at Moneysupermarket.com , Tim Moss said, "There is no doubt that unsecured loan companies are tightening up their lending criteria. While there are still some good rates on offer, Sainsbury's Bank for example is offering an unsecured rate of 6.5 per cent at the moment, the companies are getting much more picky and even those who get accepted are likely to miss out on the headline rates. Secured loans are becoming a very viable option as a result." Secured loans have traditionally been viewed as a last resort for people with a poor credit rating, due to the property with which the loan is secured against; being in danger of becoming repossessed should repayments fall behind schedule. Rates were also much less competitive compared with those on unsecured loans, but now it appears that companies are offering secured loans with rates as low as 6.9 per cent for customers, with homeowners with unblemished credit history being targeted. Moss said, "Loan brokers generally receive commission of between £2,500 and £3,000 per loan sold, so marketing secured loans directly to customers has allowed companies such as Fair & Square and Picture Loans to offer lower rates." The terms and language being used by loan providers has also been made easier to understand for consumers with Neil Radley of Fair & Square saying, "We recognise that people are often wary of secured lending, which is why we have been careful to make our loans as simple and transparent as possible and to keep penalties to a minimum." Although market analysts recognise secured loans as a good option for homeowners who are unable re-mortgage to release equity from their homes because of the rigid penalties for low rate deals, many people are committed to fixed or discounted rate deals. Radley said, "Secured loans offer a means of getting some of the money out of your property without incurring penalty charges. Our research shows a lot of people have unsecured loans and credit card debts they would like to consolidate at a lower rate to give them greater control. Why pay 18 per cent or 20 per cent on a credit card when you could be paying just 6.9 per cent on a secured loan?" Tim Moss of Moneysupermaket.com concluded, "I believe secured loans will become more and more popular during the next year or so. That said, you must remember that loans of this kind are secured against your home, so it is very important not to miss the repayments." Article Source: http://www.ArticleBlast.com |
About The Author:
Phil is an author of several articles pertaining to Secured Loans. He is known for his expertise on the subject and on other Business and Finance related articles.
Phil is an author of several articles pertaining to Secured Loans. He is known for his expertise on the subject and on other Business and Finance related articles.
| Comments On This Article: |
Only registered users can write comments.
Please login or register.
You are welcome to publish this article free of charge on your website, newsletter, or e-zine, provided:
- You don't change the article in any way
- You include the entire article, including the "about the author" box
- All hyperlinks must remain intact, including email addresses, and the link to ArticleBlast.com at the bottom
- In doing so you agree to indemnify the article's author, and ArticleBlast.com and its directors, officers, employees and agents from and against all losses, claims, damages and liabilities which arise out of its use
- It is also recommended that you provide a courtesy copy of your publication to the author of the article
