Changes in the Secured Loan Market
7 March 2010There have been some changes in the secured loan sector over the last few months. This does not involve how the secured loan process works and the regulation process has not changed. The main changes have been with the fact that the lenders have tightened things up and it’s a bit harder to get a secured loan.
With the sub prime fallout in America we have seen the effect ripple through to the lending process in the UK. The amount of mortgages that have been turned down is at an all time high and if you want a secured loan it has become harder to come by.
A secured loan is sometimes called a second charge loan because the mortgage is the first charge and any other loan taken out thereafter is secured on the property is called a second charge secured loan. This is why a secured loan will usually have a higher APR than the mortgage.
The biggest change comes in the loan to value. In the last few years we seen secured loan companies advertising that they can offer loans up 125% of the property. This has changed and most companies will now only offer about 90% loan to value.
The loan to value is calculated by adding you mortgage and the amount you want to lend and then taking it as a percentage of you house valuation. The reason it has been easy to get a secured loan in recent time is because house prices had gone up very quickly and home owners took advantage of it.
However over the last few months house prices have slowed down a lot and this has lead to fewer home owners being able to take out secured loans. The amount of applications has actually gone up but it’s just harder to complete the loans.
Taking out a secured loan is a longer process than taking out an unsecured loan. With an unsecured loan you can have your money within a few days. However a secured loan can take longer as you usually have to wait for credit checks and then a valuation of the property.
The quickest you could obtain a secured loan would be about three weeks. Loans over 25,000 GBP are unregulated and so have no cooling off period so it’s possible to get these a bit quicker.
If you want to raise a large amount of money for a one off event like perhaps home extension, loft conversion or a big wedding a secured loan is a very popular way to do it. The fact than you can spread the payments over a longer period seems to be an attractive option to many home owners.
With the recent interest rate hikes over the last year many home owners with fixed rate Mortgages do not want to move home as they will have to switch their mortgages and they know they will not get as good a fixed rate now with the higher interest rates. So instead of moving they apply for a secured loan and put an extension on their existing property.
Lenders have also tightened up on details of people’s income. In the past they paid more attention to the value of property and less on their income but they now calculate if the borrower will be able to make the payments. This also leaves it more difficult to get a secured loan. However if you are consolidation debt this is taken into account and the reduction in your monthly bills can become an advantage.
So in conclusion there are still good choices available when taking out a secured loan and the loans will be suited to your circumstances. However the lenders have tightened thing a lot and it means that there are more applications being turned down. However the amounts of applications are at an all time high so they are still very popular in the UK.
Video about loan
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Question about loan
How long is the loan process when buying a house?I found a house, got a loan approved, made an offer, got the inspection done and the loan company had the apprisal done. Now however my mortgage loan officer said my info was with the underwriters and would let me know of the final approval. Could my loan still be denied?
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Tags: Fast Secured Loans, Secured Loan, secured Loans, uk secured loan, uk Secured LoansCategory : Business
Commercial loans have not taken the same hits as residential. Underwriting for residential loans had become beyond ridiculous allowing everyone to get a loan, whether they could make the payments or not.
Commercial lending has been constant in its criteria, thus it has remained stable.
The biggest impact on our market is the following:
1. – There is no longer any subprime lending
2. – Jumbo loan rates have been rising disproportionate to the rest of the market
3. – The ALT-A market has all but vanished
4. – FHA Loans have become increasingly attractive.
5. – Fannie Mae loans have for the most part remained unaffected.
While I certainly cannot predict what the market will be like a year from now (if I could I wouldn't be writing loans and training loan officers for a living) I don't see subprime on the radar for quite some time. Everything else will come around and normalize.
Here's a point that everyone seems to be missing. For the most part this is a market problem – Given time the market will correct the problem. Not the Senate.
agreguense a mi torneo de gran dt
nombre del torneo : cabrera fc
nombre creador : emiliano
apellido II : cahuana
lmao…
he aint goin back to city.. ha ha
He is a gifted player no matter what!!
@Tunissan I agree with you, its true he ended up being a burden at City. But also you have to see that Ronaldo & Ronaldinho did not play in EPL. But i cant make excuses for him. But how i seen it people cant say he doesnt pass or is selfish because football wise he is a lot more intelligent than any player in the PL. But it is his fault he moved to England were it doesnt suite him so he will have to pay the consequences.
00:16 WOW
Yes we know that it was the democrats that are always for any handout program, it was their fault. They are and their followers are like immature school kids on the playground, always saying "no he did it". never owning up to anything, only misplacing the blame.
Now they want more stimulus packages, I thought they criticized the Republicans for the same thing?. Their own ignorance and lack of boundaries will be their own demise. They cannot survive without us balancing them, I am looking forward to a great fall!.
President Bush did do a great job protecting our country Bon Bon, you were right. I saw a clip of him waving, and I got tears in my eyes. I waved back at the t.v. and said goodbye, we will miss you. Our country will miss the last Godly man they will ever see in office. Boy does his face look like an angel compared to the devil they are gonna put in there.
Queentut I look forward to your questions, please be diligent, don't give up the good fight. It is you and your tenacity and service to our country that is the glue that holds us all together.
Great talent, Great stubidity !
That’s unfortunate, If he was slightly smarter , he would’ve been on the top with Kaka , Messi and Cristiano
A alegria está na arquibancada
O Rei das pedaladas voltou
Início da grande arrancada
Que o torcedor tanto esperou
Agora não estou mais sozinho
Para avisar aos pessimistas
Porque aí vem Robinho
Para encantar os santistas
Well, I used a second mortgage in place of a down payment when I purchased my home, and the rate on the second mortgage is in the 5 percent range, quite a bit lower than the 6.8 percent that you'd get from the student loan. So perhaps a second mortgage would be better.
Also, as for the loan forgiveness that you'll be eligible for, will you have to prove that the loan was actually used for education purposes prior to the foregiveness?
Who?
So Lets Bail out theses companies to The tune of 700 Billion Dollars and the CEO'S that run them should be able to Keep what ever they Earned for Running there companies into the Ground What a solid Plan.Trickle Down Don't work Hasn't worked For the Last 8 years or the last 30 For that Matter In theorie it Should But the Greed of the Corporate CEO has kept it From working. Moving Jobs over seas don't Trickle down to to The Unemployed its a simple concept
@sb1282000 there was one big problem with robinho: he couldnt transform his flicks, skills and tricks into something useful (unlike Ronaldo, Ronaldinho in his prime and others), so he usually ended up looking like an irritating cry baby juggling in the middle of the field
yep that's it, and Bush warned us in 2005 and 2006 about this mess and no one listened. and during that time Obama was pushing this from his "community organizing post" called ACORN. yep thats it and so the head fraudster apoints other fraudsters to his cabinet. Good Job, you have reached the lightning round.
And to Mark M. the President does not appoint the CEO of Fannie Mae or Freddy Mac. although they are exempt of the requirements of the Securities and Exchange act of 1933, they are regulated through the Office of Federal Housing Enterprise Oversight of which President Bush appointed James Lockhart to head that office, in April of 2006 stop filling peoples heads with your twisted lies.
The answer is: YES
Please do not mind but I–and many other readers— would nave preferred a shorter, more concise, question
Thank you for drawing our attention to to the need for giving in charity.
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