How to Qualify for Secured Loans
If something happens in your life that you were not prepared for financially – think unforeseen home repairs, hospital stays, or automobile accidents – then getting your hands on some fast cash is often your best bet for getting through the crisis. But how can you come up with the funds without paying a hefty interest charge for a payday loan?
You do have other options, and one you may want to consider is a secured loan. For secured loans, UK residents who are homeowners have a chance to qualify. Unsecured loans are available to people with good credit histories because lending institutions consider them a good risk. However, you can have a bad credit history and still qualify for a secured loan if you are a homeowner.
How a Secured Loan Works
If you have weighed the alternatives and you’ve decided that a secured loan is right for you, then you need to keep in mind some important information about the process before you begin. Lenders can only grant you a secured loan if you have a bit of equity built up in your primary residence. The equity serves as collateral, or the security, for your loan. When you are going through the application process, you should remember that the amount you borrow cannot exceed the equity that you have built up in your home. You must also be prepared to furnish the bank with a detailed explanation of what you intend to do with the money once you receive it.
Finding the Right Lender
It’s important to find the right lender when applying for a secured homeowner loan. You must track one down that will be willing to accept your negative credit history. This should not be too terribly difficult if you own a home with equity built up. Although there are a great many lenders that offer secured loans, they may not advertise this fact to the public at large. This is why it’s important to do your homework. There are many lending institutions out there that provide the service, and there are also quite a few comparison services online – simply type in “secured loans uk” and see what you can find or visit this site.
If You’re Using a Loan Broker
If your poor credit history is causing you trouble in your search for a secured loan, then consider a loan brokerage. They can help track down lenders that may be willing to work with you. Once you’ve made your application with the brokerage, they’ll help you track down the best secured loans for your financial situation. The brokerage then does all the heavy lifting for you – they file the paperwork, run interference between you and the lender, and make sure you have met all of the requirements before the time comes to sign the final loan documents. After you finish the application process, you’re generally subjected to a “consideration period” that allows you a little time to cool off before the loan is serviced. So, if you find that you no longer need the money after the initial application process, you still have time to back out.
