Though Secured Loans face fierce competition from Unsecured Loans, but still it has not lost it popularity. Till today, most of the UK residents prefer Secured Loans to Unsecured Loans because of the benefits attached with it. Secured Loans continue to maintain its territory even after years. The list of benefits attached with Secured Loans is endless.
Before discussing about its benefits, let's find it out: What is a Secured Loan? A Secured Loan is a type of loan which requires collateral against the loan taken. The collateral offered guarantees the repayment of the loan by the borrower. Collateral can be of different types, the most common one is your home. Different lenders have different policies for the collateral. However, most of the lenders demand your home as collateral.
Now, let's discuss about the benefits attached with Secured Loans. Out of many, one of the most important benefits that give Secured Loans an edge over Unsecured Loans is the rate of interest. Secured Loans generally charge a lower interest rate as compared to unsecured ones.
The second most important benefits attached with Secured Loans is that borrowers can draw as much of cash as they want. Secured Loans acts as a best rescue when you are in need of a fairly large sum of money and you have equity in your property. Secured Loans offer you flexible and manageable monthly repayments. The lower interest rates and longer repayment periods makes your monthly repayments far lower than that of an unsecured loan.
Secured Loans are more easily accessible to bad credit history cases than an unsecured loan. Bad Credit Secured Loans are available at really competitive rates. A Bad Credit Secured Loan allows you to enjoy lower repayment terms even if your have a bad credit history. The Secured Loans lender are generally more willing to consider bad credit history case because the loans are secured against an assets resulting in making them face a less amount of risk.
Secured Loans can be used for a wide variety of reasons, such as, debt consolidation, holidays, home improvements, holiday's et al.
Though Secured Loans are loaded with benefits, but the borrowers should always keep in mind that if he fails to repay, his home might be repossessed by the Secured Loan lender. So, before applying for a Secured Loan, be certain about the fact that you can afford the monthly repayment. Settle for the deal that is affordable and manageable.