Unsecured Homeowner Loan

An unsecured homeowner loan does not require you to use your home as security against the loan. The amount that you will be able to borrow, and the interest rate you’ll be offered by the lender will therefore depend entirely on your past credit history. If you have been a responsible borrower you will find that you will be eligible for a wider range of products with favourable interest rates. However, if you have missed loan or mortgage payments, had CCJs filed against you or if you have participated in a debt management plan, you would need to pay more interest on the loan.

Popular reasons for choosing an unsecured homeowner loan include expenses such as a family wedding, car or a holiday. Although you can actually use the loan for any (legal) purpose that you choose, some lenders specialise in unsecured homeowner loans for specific expenses such as car finance, home improvements or debt consolidation. Therefore it pays to shop around, because you may find that a specialised loan provider will offer you particularly good interest rates on an unsecured homeowner loan. For larger amounts, up to £75,000, you would usually be expected to secure the property or another asset against the loan.

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Unsecured Homeowner Loan: Quick Definitions

• An unsecured homeowner loan is generally taken out by people who do not wish to risk their property.
• An unsecured homeowner loan may be suitable for you if you are looking for a small short-term loan, which you are confident about being able to pay back within the allotted loan term.
• The interest rate for an unsecured homeowner loan will usually be higher than for a secured loan, because the lender needs to compensate for the lower level of loan security.