There are several types of loans available to borrowers in the United Kingdom. Each is suitable for different things and will have different terms and conditions attached. Visit a professional for some financial advice on which one suits you and compare the various products online.
There are quite a number of different loans that can be taken out in the UK. If you are looking for a small cash loan you could consider a payday lender. If you have a poor credit rating you may be able to try a logbook lender if you own your own vehicle. If a larger amount is needed over a longer period of time there are two main types to choose from, secured and unsecured loans.
If you need a very large amount of money you may like to take out a secured loan. You will need to put up an asset, usually your home, as collateral or security in case you do not keep up your repayments. In that case they would be able to sell your home in order to get back the money you owe them. As there is a risk on your part, they tend to offer good interest rates and long term payment options.
In comparison an unsecured debt is not backed up by any assets as collateral. As the lender is relying on you paying back the money the interest rates will be higher to reduce the risk to them. This type of borrowing is usually short term, up to about five years. The payments will be set over the agreed period and if the debt is repaid early there are normally early repayment charges. This type of product is also known as a personal loan.
A mortgage is one common type of secured debt. The bank or building society co owns the property with the borrower up until the mortgage is paid in full. If the borrower defaults on the debt the bank can sell the property to recoup their investment. Other secured debts are commonly taken in order to consolidate large debts. You can apply for a loan to cover the amount of all of your current debts merging them into one debt with one lender for ease of payment.
Unsecured loans are very popular with medium size purchases like cars and holidays. The rates will be higher than secured ones and the terms are usually inflexible. This type of product is very popular and the market is saturated with lenders. You should compare a few before committing to one.
You can improve your financial situation by taking out one of the above types of loans. Which one you go for will depend on your personal situation and you may like to take some professional advice before signing any agreements. Make sure that the interest rates and length of borrowing are manageable for you to pay back.
Looking to find the best deal on a secured home loan, then visit www.iLoansDirect.co.uk to find the best advice on loans including a debt consolidation loan.