SimplyFinance - Personal Loan

How to Get the Best Deal on a Cheap Secured Loan

2007-08-12T23:00:00Z

Whether you’re looking to open a new business, consolidate debt or pay for home improvements, a cheap secured loan is perhaps one of the more affordable ways to get financing. Although it’s a competitive market, there are still some basic guidelines that will help you get the best rate for your cheap secured loan.

The first thing anyone looking for any type of loan should be aware of is their credit report. Before you speak to a lender, check your credit and ensure that there are no inaccuracies that need to be corrected as this can affect your rates. Generally, even borrowers with less than perfect credit will have luck finding a cheap secured loan as the lender has the collateral to guarantee the loan.

Another way to be prepared for your cheap secured loan negotiations is by preparing your monthly budget. Know your debt to income ratio, and use online loan calculators to help you calculate this amount, should you require assistance. Knowing this amount will help you be aware of how much of your cheap secured loan you can truly afford and how much you will need to finance.

Comparison shopping is the best way to make sure you’re getting the best rate and terms for your cheap secured loan. Check with your current home loan lender, credit unions, and of course, online lenders to see what the marketplace has to offer. Many online lenders offer special discounts on cheap secured loans that traditional lenders, like banks, won’t offer.

You’ll need to ask about the repayment terms from each cheap secured loan lender, and you'll want to compare them against one another within those terms. Ask the lender about the APR (annual percentage rate). This calculates the total cost of the loan which includes the loan amount, interest, and any fees you might be required to pay, but it will be calculated at a yearly rate.

Many lenders offer a low interest rate on cheap secured loans, but you’ll want to check that the lender that offers the lowest rate doesn’t also charge the most fees, such as set up fees, appraisal fees, application fees, administrative fees, transaction fees, or exit fees. Make sure that the cheap secured loan lenders you are comparing provide a list of fees and potential payments up front before you start filling out the application.

The other item that can affect the amount you'll pay over time is the length of the cheap secured loan term. The longer your loan term, the lower the payments, but this can also cost more in the long run due to the interest. The best cheap secured loan for you will be one that offers the right balance of a low rate and a shorter repayment time.Look no further than our easy online applications to get started with a cheap secured loan. SimplyFinance is here for you to help you get the best rate and loan terms from the most reliable and competitive lenders in the UK.

CLICK HERE TO APPLY FOR A SECURED LOAN TODAY!

Secured Loan Advice

2007-08-31T07:00:00Z

Obtaining a secured loan can be one of the cheapest and hassle free ways to acquire a loan. What is more, a secured loan can be comfortably repaid over an agreed number of years. Basically, a secured loan is a loan where the consumer’s home, or another valuable asset, is used as collateral to secure a loan from the lender. However, compared to unsecured loans, the risks surrounding secured loans are significant. In most cases, your home must be used as collateral against the loan, so it can be repossessed by the lender if you fail to keep up with repayments. With this in mind, taking out a secured loan is a decision not to be made lightly. Using you home as collateral against a loan is a big risk and it is vital to keep up with repayments.

Secured loans are usually significantly larger than unsecured loans, ranging from about £5,000 to £75,000 and can be repaid over a longer term of up to 25 years. Lenders will charge an annual percentage rate (APR) on the amount you borrow. At present, interest rates on secured loans range from about seven percent to eight percent.

When shopping for any product, financial or otherwise, it always pays to shop around. Approach a number of lenders to see who offers you the most favourable interest rate. Also examine the terms and conditions of the loan closely. For example, some lenders will penalise you if you pay off the loan early. This is known as a redemption fee. However, if you feel you might pay off the loan early, thus saving money on interest repayments, find a lender who does not charge these fees, or negotiate so that the your lender agrees to waive such fees.

There are countless banks and financial services offering secured loans in Britain today, and there are many ways you can apply. You can simply visit an outlet of any high-street bank, or you can apply by phone, online or by a written application.

The amount you can borrow will depend on the value of the collateral and your own financial situation. If you are self-employed, unemployed, or if you have a poor credit rating, the amount you can borrow will most likely be limited. However, if you are in a sound financial situation with a steady income you may be able to borrow up to 125 percent of the value of your collateral.

On smaller secured loans, under £25,000, you will be given seven days to make sure you are happy with all the terms of the agreement. If not, you can cancel the agreement within this seven-day limit. Meanwhile, the lender will assess all aspects of your finances to assure you can meet repayments. The lender may also want to examine your home, or other collateral, to determine its true value.

If you have a poor credit history, be honest with the lender. This information will most likely be already on record and, since the loan is secured, most lenders will offer a loan in any case.

Of course you will have to keep up with your repayments, but British legislation offers some protection for consumers when it comes to financial services. All secured loans are covered by The Consumer Credit Act of 1974.

As mentioned, loans under £25,000 provide the consumer with a seven-day get-out clause. However, loans greater than £25,000 are unregulated, so extra care should be taken to read and understand all terms and conditions before signing. However, you can also protect yourself through payment protection schemes and insurance policies. These will add a little extra to your repayments but will cover your repayments if you become ill, unemployed, or if you have an accident. Your lender will be able to provide you with such a product, but again, try shopping around, there may be a better deal out there.

If you do run into financial trouble and it looks like you may miss a repayment, you should contact your lender immediately. This may be daunting but any lender will be happy to receive communication and some may be surprisingly helpful by offering to defer repayments or reduced repayments over a longer term. If you need advice, there are hundreds of debt counseling agencies in Britain today that will help you overcome your financial problems, and many of them are voluntary. However, this is worst case scenario. In the main, secured loans provide a cheap and easy way to take out a sizable loan and can be easily and comfortably repaid if properly considered.

If, after careful consideration, you've decided that a secured loan is the right option for you, let us help you find the best secured loan deal available. Take just a moment to fill out our simple questionnaire, and one of SimplyFinance's representatives will contact you shortly to introduce you to a lender that will work with you to find the best secured loan deal. It's quick, simple, and you're under no obligation to us or to the lender we introduce you to.

Ways to Manage Your Personal Loan Debt

2007-10-09T07:00:00Z

Although the Bank of England has left the base rate at 5.75 for the past week, personal loan lenders have had to increase their interest rates dramatically to deal with the current credit crunch that's plaguing the UK.

According to the Bank of England, interest rates have risen by almost 25% in the past year. While some lenders, such as Bradford & Bingley, have attempted to freeze interest rates on personal loans at a manageable level in recent months, they've now had to lift the freeze and raise rates. This is due to the five interest rate increases in the last year and the increase in borrowing costs because of the tumultuous financial markets. These increases will only affect new personal loan borrowers; those already tied into an interest rate will remain unscathed by the interest rate hikes.

All of the interest rate increases are being blamed on the uncertainty surrounding the financial markets, the increasing levels of debt, and the past year of rate rises. All of these factors are putting increasing amounts of pressure on individuals' and families' disposable income. Because of the strain being put on people's finances, it has become riskier for lender to do business, hence why they've had to raise rates.

While all of this information paints a grim picture for all of our financial futures, there are ways in which you can work with your finances to decrease the amount of stress put on you. Here are a few suggestions to help you through:

If you need to take out a personal loan, shop around to find the one with the lowest possible rate. Finding the best rate could save you hundreds of pounds in interest charges over the term of your loan.

Instead of using credit to buy things now and pay later, try to save up for major expenses. This will decrease your overall expense because you will not be stuck paying interest charges if you make your purchase outright.

Take some time to make a budget. Find out where your money is going each month, and do your best to find ways to decrease spending on unnecessary items. Find a cheaper phone plan, start clipping coupons, or buy more groceries instead of eating out. Every little bit helps.

Start reducing your debt as soon as possible. Interest rates aren't expected to decline any time soon, so it's best if you attempt to rid your self of as much debt as possible, as soon as possible. Start with debt with the highest interest rate, and work your way down.

Once your debt is clear, try hard not to take out any more loans or buy anything else using credit.