Secured Loans Equity Margins Slacken Off.
Although remortgages and secured loans have a great deal in common, as they are both are in fact secured homeowner loans which are based on whatever equity is available on a property.
For those unfamiliar with the word equity, what equity is is what is left when the amount outstanding in a mortgage. This means that if the mortgage balance on any particular house or apartment is-0,000, and the worth of the property is 100,000, the equity is 30,000.
Up until 2007, when then the UK recession commenced many secured loan lenders such as Paragon Personal Finance, EPF, Future Mortgages, EPF, First Plus, etc. etc. all were only too happy to advance secured loans at 90% to anything up to 95%, and this applied to all secured loan lenders.
There were even secured loan lenders willing to advance secured loans to self employed applicants up to 100% LTV and these secured loans were granted on the basis of self certifications of income , and up to a maximum loan value of 75,000.
Secured loans were granted as if they were going out of fashion , and although sometimes the underwriting criteria was perhaps a little slack at times, these secured loans were a great useful product enabling secured loan applicants, both employed and employed to obtain a loan to use for a number of purposes.
Nowadays self employed applicants need further proof of their correct earnings. There are still however a couple of non status lenders who still accept this income proof at tight loan to values and at high interest rates.
It is equally frustrating for the many decent reputable secured loan brokers to be so frequently unable to obtain a secured loan for a customer which in the past would have been an application welcomed by the secured loan lenders as the main stay of their business.
With Black Horse, the secured loan lender increasing their LTV for secured loans from 70% to 80% some hope of a resurrection is spreading in the secured loans sector.
The most important feature for obtaining a secured loan has been the equity in the property, although a credit rating is also taken into consideration.
Let us hope that 2010 will be the best year for secured loans for some time.
Learn more about secured loans. Stop by Champion Finance’s site where you can find out all about secured loans and what they can do for you.