Are Homeowner Loans The Best Choice for Property Owners?

Adam Brand Adam Brand | Operations Director

Like most homeowners, there are times when you would like have access to extra cash to pay for things your regular budget will not allow. For example, you might want to upgrade your conservatory with some new windows and perhaps a skylight or two. Maybe you want to take that dream holiday to celebrate 30 years of marriage to a spouse you couldn't dream of living without. Yet covering these types of expenses might be challenging without financing. That is where home owner loans could come into play.

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A homeowner loan is a personal loan taken out against the equity in your property. Also known as secured loans, these are offered by specialist lenders, banks and building societies in exchange for you offering your home as collateral. Securing the loan with your home enables you to borrow substantial amounts of money for long periods. Moreover, because the lender puts a charge on your home as security, it is not difficult to get very good interest rates and manageable terms.

We believe homeowner loans are in many cases the best choice for property owners when compared to other sorts of financing. For purposes of verification, let us look at some of those other options:

  • Targeted Loans - You are familiar with targeted loans if you have ever purchased a car by way of financing. The loan you received from the lender was targeted only for that car purchase; you could not have taken the money and used it to purchase computer equipment. Homeowner loans are more flexible in that you can use them for virtually any purpose.  But bare in mind, some lenders occasionally will still want to know the purpose of the loan.
  • Unsecured Personal Loans - The unsecured personal loan does offer you a lot more flexibility, but it is offered only on your promise to repay. That means you will pay a higher interest rate than you would with a home loan.
  • Credit Cards - It seems hard to believe, yet many consumers will take care of their long-term financing needs by using credit cards. It is true that credit cards make financing fast and simple. However, it is also true that they come with astronomically high interest rates. You will spend a lot of money financing long-term debt with a credit card.
  • Savings Accounts - If you had to choose between draining your savings account and using credit cards, the savings account is a better option. Nonetheless, the money you have in savings is designed to be used for emergencies and rainy days. You might consider using it for that purpose rather than to cover your long-term financing needs.

Homeowner loans are better than all four of the above options in many cases. They are more flexible, less costly, and fairly easy to get if you own a home with equity.

Obtaining a Loan

You can obtain a homeowner loan by comparing lenders and then applying with those that seem to offer the best deals. Pay attention to the minimum and maximum loan amounts offered by each prospective lender, as this will play a role in your decision. You will only be able to borrow up to the limit of your equity. However, this is a very time consuming process and basing your choices on advertised deals is not the best way to find the most suitable loan for your needs.

You might also consider applying for just a single loan at a time. However, every time you apply for a loan, the bank or building society in question runs a search on your credit. Every credit search has a negative impact on your credit score, albeit minor, so the idea is to end up with as few credit searches as possible so that you eliminate any risk of lowering your credit score and having to pay a higher rate to get a loan.

There is an alternative, why not let our secured loan experts do the work for you. Our team are specialists in obtaining the best loans available from our whole of market panel of UK lenders. We will match your requirements with all the deals on offer, ensure that you are aware of all the costs of each individual loan before you chose to apply and will make the application on your behalf ensuring that your case is seen by the lender in the most favourable light. Our experts are there to ensure you get the best deal and what??s more our advice is free so why not take advantage of our expertise.  But also applies that you seek indipendant financial advise to ensure that a secured loan is the right product for your perticular circumstances.

Homeowner loans are great tools for financing everything from home renovations to elective healthcare to the romantic holiday of a lifetime. Thanks to the equity in your home, you can turn your property into a powerful financing tool that works to your advantage. Secured Loan Expert encourages you to make the most of it.

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