There are two main types of loan in the UK.
Unsecured loans and
secured loans.If you want a personal loan of more than £25,000 then you have no choice but to take out a
securedpersonal loan.
Secured personal loans are simply loans offered by a lender in return for some form of security. Normally this means that the loan is secured on one of your assets. In most cases, this asset will usually be your home.
Securing a personal loan in this way allows more money to be borrowed (often at a lower interest rate), but also places the asset at risk if you cannot keep up the loan repayments. A
Homeowner loan,a home improvement loan and a debt consolidation loan are alltypes of secured loans.
It couldprove to be cheaper to borrow more money on your mortgage than to use your house as security on a separate secured personal loan. And, be aware that your mortgage lender may not be happyfor you to secure a loan on yuor home.
Unsecured personal loans are available for sums less than £25,000 and are available at a variety of different interest rates and repayment periods. You may get an unsecured personal loan for many purposes, but not for business or speculative reasons. The
interest rate you get depends on the amount you borrow and on your
credit history.
If you have a bad credit rating and you have found it difficult to borrow money then check our
Bad Credit Loans section. Some people may find it difficult to get a loan even though they have a perfectly good credit history. This will normally be because they have a ‘non-standard’ occupation, for example they freelance as a consultant or they only work part of the year. If you fall into this category and you have had problems getting a loan then approaching a lender who specialises in ‘difficult’ lending decisions (like a ‘bad credit’ lender) could be the answer.
