	Article Directory		Article Submission Service		Article Marketing Blog		Publishers		Member Log In

Article Directory :: Finance & Investment Articles

The Many Uses For Homeowner Loans Otherwise Known As Secured Loans.

By Liz Moir

Republish: EasyPublish™
Published: 11Dec2009
Word count: 624
Viewed: 409 time(s)

Get Free Content For Your Site

There are many different types of loans both unsecured and also secured.

Unsecured loans, as the names makes more than clear, require no form of security whatsoever , and as such are available to both those who do not own their own property, that is , tenants, and also to homeowners.

Even at the best of times that is pre credit crunch unsecured loans were difficult for tenants to obtain, as being completely unsecured, the lender was taking a risk that he could lose the money advanced in the case of the tenant defaulting.

For homeowners unsecured loans were slightly easier to obtain, although the maximum loan was normally restricted to around £15,000 which is often not an adequate amount if the loan is required to fund a major purchase such as a motor home, or to pay for subtantial home improvemnts such as a conservatory, an extension, a swimming pool and so on.

Tenants have no option but the unsecured loan but for homeowners the situation is very dufferent as they also have the choice of homeowner loans.

Homeowner loans are only availabe to homeowners and they are an excellent way to fund almost anything. Homeowner loans are also called secured loans as they are secured on the equity of the property.

Unlike before the recession, homeowners cannot obtain a secured homeowner loan if there is no equity on the property.Equity is the difference between the value of the property and the balance left on the mortgage.

To give an example of the above, if a property is worth £200,000 and the mortgage is £190,000 the equity is in fact £10,000. Now that the maximum equity is 70% for the self employed and 80% for employed the above would mean that the borrower is not eligible for a homeowner loan until the property rises in value.

If a property is worth £300,000 and the mortgage balance is £200,000, the maximum available homeowner loan would be £40,000 if the applicant is employed and £10,000 for a self employed borrower.

Before the credit crunch 125% equity plans were available but only to employed borrowers with a good credit rating, and in those golden days of yore if a property was valued at £200,000 and the mortgage outstanding was £190,000 homeowner loans of up to a maximum of £60,000 were available.

Homeowner loans are a good way for a homewner to borrow as their interest rates are normally lower that that of unsecured loans, starting at present at about 9% APR.

As these loans are secured, lenders are not concerned about and never require proof of the purpose of the loan, unlike with unsecured loans.

With unsecured loans to be used say to buy and fit a new kitchen , it is not simply a matter of stating to the lender that you intend to buy a new kitchen as he will require proof in the shape of several estimates.

With homeowner loans it is only a matter of stating the purpose for the loan on the application form and no proof will be asked for, making this a simple way to borrow money.

With secured homeowner loans you will have cash in hand to obtain the best possible deal whether it is when buying a car, doing homeimprovements, etc.

One of the most common reasons for obtaining a homeowner loan is to consolidate credit cards, personal loans and hire purchase.With the interest rate for secured homeowner loans being so much lower than credit cards, etc. there are massive savings to be made, and in addition to saving money the homeowner will have only one payment to make each month compared to several making finances easier to handle.

Homeowners really do not have to look any further than homoewner secured loans when they decide they require funds for a myriad of purposes.

Champion Finance has been established since 1985, making them one of the longest if not THE longest established finance broker in the UK. They arrange secured loans for both employed and self employed applicants. Whole of the markert mortgages and remortgages are also available.

EasyPublish™ this article - publishers click here