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All You Need to Know About Home Loan Secured On Your Property

Until recently, a home loan secured on to a property was seen as a last resort. However, with the instability of the economy, many people have experienced a significant change in their circumstances. Because of this, the only way some people can borrow a large amount of cash is take out a secured loan.

A secured loan is when a lender loans money with a house secured on it as collateral. This means in the event the person does not meet the loan's repayments, the lender can take their home and sell it to recoup the outstanding balance. Because of the risky nature of having a home loan secured on your property, it is always best to seek proper financial advice before committing yourself.

Because a secured loan offers the lender security by way of a person's house, financial institutions are much more likely to lend to people with a poor credit history. It is this that makes them so popular. Another plus is while the average unsecured loan is anything up to £25,000, a secured loan can see people borrowing up to £100,000.

Money expert Martin Lewis' Money Saving Expert website warns people to think very carefully before taking out a home loan secured on their property. According to the website any loan that involves putting your home at risk should be done purely as a last resort and when all other options have been exhausted. According to the Money Saving Expert website, the average £10,000 secured loan, repayable over a five-year period has repayments of £212 per month. The same loan over a ten-year period is £132 per month. Secured loans can be affordable and if you are sensible about the loan amount you borrow, there is no reason why they should be any more risk than an unsecured loan.

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