Secured loans, as the term suggests, are secured against collateral. The collateral could be anything- your house, bonds, jewellery, or your car.
Since secured loans pose almost no risk to the lender, he sets easy terms and conditions for the borrower. For the borrower, the advantages of borrowing a secured loan are: Low monthly instalments Long repayment period Low annual percentage rate
There are two disadvantages of the secured loan as well. First is the delay factor. Secured loans take a long time to be disbursed because of the evaluation of the collateral and the resultant paper work. Another disadvantage of secured loan is the risk to the borrower. If he fails to pay back the secured loan amount on time, his property could be sold off by the lender to recover the secured loan amount. However, if we consider the advantages, the borrower could easily ignore these disadvantages.
Types of secured loans: A variety of secured loans are available in UK like personal secured loan, fast secured loan, best secured loan UK, bad credit secured loan UK, personal secured consolidation loan, low rate secured loan, etc.
Purpose: Secured loans can be used by the borrower for a number of purposes. He can use it to:
- Meet the expenses of an expensive wedding in the family
- Pay long medical bills
- Renovate his house
- Consolidate all his past debts
- Purchase a vehicle
- Meet his holiday expenses
- Pay back his past debts
Secured loans can be availed by people with bad credit history as well. A borrower can improve his credit rating with the secured loan amount.
With so many uses and so many advantages, secured loans are the obvious choice for all those who are facing financial problems.
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