Last post: Sep 26, 2017
Secured loans can be very helpful products for individuals with a less-than-squeaky-clean credit record who, nevertheless, have the means to repay their loan and an asset to secure their borrowing against. Considering it? Here are three important questions to ask yourself before going ahead.
Although secured loans do present a very helpful alternative source of finance for borrowers without a perfect credit rating, they aren't the best choice for every individual or family. From your grasp of your finances, to the water-tightness of your financial planning, there are some very important areas to consider before pressing ahead with a secured loan.
These three questions will help you ensure secured finance is the right route for you...
1. Do you have a realistic budget in place?
No responsible lender or broker will allow you to take on a secured loan which includes repayments you cannot afford to make. However, examining your own finances and understanding precisely what taking on your loan will mean is crucial. Do a practice run of your proposed household budget before applying for your loan to make sure it is workable, and ensure you've taken every cost into consideration (including admin fees) before going ahead.
2. Is a secured loan your best option?
Ideal for borrowed without a perfect credit score, secured loans are a very good fit for those looking to source non-traditional finance. However, if you have access to a conventional mortgage or similar products, you should explore every avenue to ensure this choice is right for you.
3. Do you understand the risks?
A secured loan is anchored to a sizeable asset – usually your property. This means feeling entirely confident that you can manage the loan is critical. Take time to think carefully about what losing your asset would mean (even if you have a watertight repayment plan in place) before going ahead. This will help you approach your secured loan with the right, serious mindset.
Did you answer "yes" to all of these questions? We can help you identify and arrange "best fit" secured loans for your unique circumstances, from £1,000-£250,000. Learn more about the products we recommend and request more information from our secured loan experts here.
Comment