How Bad Credit Secured Loans And Homeowner Loans Can Help When You Have Poor Credit History

secured loans

Secured loans and homeowner loans are types of loans available to people for a multitude of uses. You may want to make improvements to your home such as decorating or building an extension. This is a great way to add value to your property.

Or it may be that you have your eye on a new car and need to raise the money quickly for this. Other common uses of secured loans are:

  • A much-needed family holiday
  • Paying for a major event in your life such as a wedding
  • Paying tuition fees for your children
  • Or even consolidating existing debts into a lower monthly repayment

For any of these situations, a homeowner secured loan will be perfect for you.

Getting a secured loan or a homeowner loan tends to be more straight forward for those who own a property. Since lenders borrow a huge amount of money, they need assurance that the loan will be paid back in full. This assurance comes in the form of collateral, be that a property you own or your home.

This has an upside and a downside.

From the lenders perspective, repayments are guaranteed. The fact that property has been used as collateral means the customer will conscientiously repay each month. If they don’t then steps can be taken to fulfil the debt using the property. From the customers perspective, you are able to borrow more at a lower interest rate, meaning lower monthly payments.

A quick look at some of the types of secured homeowner loans available

Just like unsecured loans, there are various kinds of secured loans for various purposes.

medical secured loans

Medical Secured Loans

One of those is that of a medical secured loan. These are great for people who want private medical treatment and would have difficulty paying a hospital bill. There are many reasons why you may want to go private. If you are not insured, the costs of staying in hospital together with the costs of the procedure, tests and medicine, as well as the doctor’s bill for consultation may be quite substantial. Not to mention the fact this figure would normally be difficult to pay. This is where a medical secured loan would be perfect. A medical secured loan will not just help to pay for this medical bill but it will also ensure a low rate of interest on repayments.

business secured loansBusiness Secured Loans

Another type of secured loan is one that is for business owners; the business secured loan. Business-savvy people know how difficult it is to set up a business. Lenders and banks knows this too. This is why entrepreneurs are able to apply for a business secured loan to be used as working capital in their business start-up. With collateral, businesses are not considered as high a risk any more. This is why a secured loan can work well for both the lender and the borrower.

secured loans for life eventsSecured Loans For Life Events

Even though a wedding is a very joyous event for the couple getting married, the most essential part of this (maybe other than the planning) is the funds. This will be used for the honeymoon, the ceremony, and the reception. This is a big reason why many couples put getting married off for several years while they save enough money to pay for their wedding.

Weddings are considered somewhat high risk as the rate of divorce is high in this modern world. lenders are aware of this and that couples will be more reluctant to pay back loans if this is the way a marriage ends before the loan has been fully repaid. However, with a secured loan, there is collateral involved and this gives a guarantee and reassurance to the lender. Of course, you could always get married for under £1000, but for those of you who are thinking of spending more then a secured loan could be the financial lift you need.

secured loans for buying a carSecured Loans For Buying A Car

Another reason for getting a secured loan is to buy a car. Owning a car and being able to rive one can make a big difference to a person’s life. It can be the difference between isolation and independence. The difference between a job offer or a job rejection. The ability to do what you want when you want to do it. Whilst public transport is adequate for many things, it isn’t perfect for everything. This means that most people need a car in order to function with society. We all know how expensive a can be, even just a second hand car. If someone with bad credit applies for a car via finance, they are likely to be refused by the car dealership. This is where secured loans can be useful. A secured loan gives lenders the assurance that repayments will be made and they can recover costs if these payments are not made. Everybody is happy. The lender gets adequate satisfaction that repayments will be made. The borrower gets a brand new car and the opportunities this brings.

secured loan for a new business suitPersonal Secured Loans

There are times in our lives when we have to invest in ourselves. You’ve just landed yourself a high rolling sales position at a big corporate (if you’ve not done this step yet, here’s how). You have lots of career prospects ahead of you. Life is good. The future is bright.

The only thing is there are certain conditions with the new career. You have worked for companies before but they were more relaxed about the dress code and equipment was provided. In your new job, you are required to dress in a fancy business suit each day and to provide your own equipment such as a tablet computer and a laptop as well as a nice watch and a nice shirt and tie. This can be a tall order before you’ve even received your first salary payment but was one of the conditions you accepted when you took the job offer.

What are your options? Put everything on the credit card?

That’s one solution but remember that credit cards tend to carry a higher APR and are probably best used for emergency situations. Another option is to apply for a secured loan and invest in yourself. Where should you get a secured loan? Well, one option is to take items that you own to a pawnshop. You will be given an appraised value and this will be the amount that you will get for your secured loan. But it is essential that you note that the appraisal on pawnshops is usually much lower than your items are worth and the interest is high when you want to buy your items back.

Another option is to apply right here through Alchemy Money.

Bad Credit Secured Loans

Generally, borrowing money may be fairly easy so long as the numbers stack up. But if you have bad credit it can be difficult. Fortunately, with the use of bad credit secured loans, you may be able to get the money that you need.

Bad credit secured loans can take various forms and may be available from a variety of lenders, both on the internet and in a physical store. But not all lenders are the same.

As with other types of secured loans, to be able to get bad credit secured loans you may need to provide a guarantee to the lender that they are going to get all their money back even if you cannot make your payments. This means that you may need some kind of collateral.

Generally, when applying for a secured loan of any kind, you should ensure that the value of your assets is much higher than the value you will be asking for. This makes the decision much easier for the lender.

It’s also worth nothing that there are countless types of loans including:

  • Automotive financing
  • Mortgage loans
  • Debt consolidation
  • And some other personal loans

All can be applied for by people with problems in their credit history. The kind of loan that you apply for will widely depend on what the money will be used for. If you choose a good lender they will assess your situation and help you to choose the best loan for you.

No matter what kind of loan you select, you may still have to choose the collateral that you use in securing it.

If you are having trouble getting a loan due to bad credit, Alchemy Money can help you. We will review your situation and advise where we can. For example, if we find the reason you have bad credit and are missing payments on existing loans is that the monthly repayments are too high for you we would look at consolidating all your debts into one and giving you a lower monthly payment.

Secured Homeowner Loan or Unsecured Loan?

For people who are able to make regular payments, secured loans are a much better option than unsecured loans due to the lower rate of interest. Lenders view unsecured loans as much higher risk and this carries a higher interest rate as a consequence.

Secured loans are also beneficial in that they tend to be eligible for a longer repayment term. This means that payments are lower and interest rates are lower. This can be favourable to the borrower.

For people who historically haven’t been able to meet their payments and have bad credit, secured loans can be the answer to rebuilding your credit score.

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