Secured loans as a remortgage alternative

In recent years, more and more people are turning to secured loans as an alternative to remortgaging.

According to the Finance and Leasing Association (FLA), secured lending, where a loan is secured against your home, increased by 14 per cent during 2012 - testament to its increase in popularity.

Like remortgages, secured loans can be used for things like home improvements, debt consolidation, paying a tax bill or even buying a new car. However, unlike a remortgage, a secured loan won’t affect your current mortgage rate.

As interest rates remain low and many people are enjoying low interest rates on their mortgages, secured loans are proving a popular alternative to a remortgage.

Speaking on the subject, Danny Waters, chief executive at Enterprise Finance said: “Traditionally, people would have remortgaged to do this but in this day and age that would jeopardize their loan rate — and would therefore be ill-advised.

“As a result, the secured loan is the perfect substitute.”

Because they are secured against your home you can normally borrow more through a secured loan than a personal loan. Loan values typically range from between £5,000 and £200,000 over a period of between 3 and 30 years.

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