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Expat Secured Loans UK

What are Expat Secured Loans UK?

Expat Secured Loans UK
Expat Secured Loans UK

A secured loan is a loan in which the borrower offers their property as collateral for the loan, which then becomes a secured debt owed to the creditor who gives the desired loan.

  • Secured loans are often called second charge mortgages because they have secondary priority behind your main mortgage.
  • The amount you can borrow, term and interest rate depend on property equity, credit history and personal circumstances.
  • Secured loans are typically repaid over 2 – 25 years and are for sums over £5,000 upwards, but such figures are not definitive and can be considerably more.
  • Interest rates are likely to be lower than for unsecured loans, but your property is at more of a risk – consider all the options.
  • Secured loans are quicker to complete than traditional mortgages. Some lenders can complete everything and disburse the monies within 4 to 6 weeks.

Learn how secured loans can be the perfect choice for you

What Are The Main Benefits Of A UK Secured Loan?

Secured loans offer expats and UK residents the opportunity to borrow fairly large sums of money over long periods. Also known as homeowner loans, these are often secured by using one’s home as collateral against the debt. There are both advantages and disadvantages to borrowing money this way, so consumers need to be careful about not taking a loan without clearly thinking it through.

We can help you obtain a secured loan that can be used in almost any way you see fit. Perhaps you need to make home repairs, buy a new car or kitchen or perhaps you are looking to consolidate your existing debt into a single loan.

The flexibility and lower costs offered by this sort of loan is one of the reasons it is so popular among UK consumers and expatriates

How Much Are Typical Secured Loan Amounts For The UK?

A second charge secured loan has a distinct advantage over its unsecured counterpart: you have the opportunity to borrow more. Typical amounts range from £5000-£125,000, depending on the lender. How can they afford to loan so much? By requiring your home as collateral. Lenders are less concerned about default when a home is used as collateral, because it gives them a tangible asset that they can sell in the event the borrower does not repay the loan.

For example, let us assume a consumer took out a £50,000 home improvement loan on a property worth £150,000. Assuming the homeowner had already built £50,000 in equity, the risk to the lender is minimal. In the event of default, the lender could take possession of the home, sell it, pay the balance of the mortgage, and still cover its own debt. Obviously, any loan scenario is subject to the borrower’s credit history and ability to repay. A more favourable financial position allows for more favourable loan terms. This includes higher borrowing amounts and lower interest rates.

What Are Other Advantages of Secured Loans To Consider?

There are a number of other advantages to choosing a secured loan over an unsecured one. At the top of list are the interest rates offered by lenders. For consumers with good credit and a positive repayment outlook, interest rates of 5% or 6% are not uncommon. It is very difficult to get an interest rate that low with an unsecured loan. On the other hand, there are usually closing costs and other fees that can add up such as valuation fees and solicitors fees. Consumers need to be aware of the fees before taking out a loan.

Fixed monthly payments are another advantage. Consumers who use this sort of financing for homeowner loans find it easier to manage monthly payments by considering them part of the cost of owning a home. This makes budgeting more manageable over the long term. The key, however, is to make sure you obtain monthly payment amounts you can afford. It is possible to lose your property if you cannot afford to keep up the repayments so always bare this in mind.

What Are The Lending Requirements For Secured Loans In The UK?

Secured loan lenders will require you to meet their individual criteria requirements. These can vary between each lender and need to be considered carefully because of the different underwriting criteria of each lenders secured loan underwriting department. Some of the more important things are listed below.

Credit history – Each secured loan lender will check your credit history through one of the credit companies such as Transunion, Equifax and Experian. Your credit rating will be used to decide if you are a good risk for the loan required but even if your credit rating isn’t perfect you may still qualify for a secured loan as it will be secured against your property.

Correspondence address – this is important especially for expats who are based overseas or spend a large portion of their time overseas. If you don’t have a correspondence address in the UK you should arrange to use your parents address or a close family member address. This needs to be someone you can trust as important documents will be in their care. To be eligible for a secured loan you will usually have to show you have had a UK address for at least three years. Having this will increase the chance that your application being approved.

Secured loan repayment plan – the secured loan lender will look for financial proof that you will be able to afford to repay the secured loan. Even though the loan will be secured against your property, proving your ability to afford the loan repayments will be necessary.

Identity – Proof of identity will be required in much the same way as it would for a normal mortgage on a house or investment property, The lender will need to see certified copies of your passport and a second form of identification such as driving licence or a local identity card if you are based somewhere like Hong Kong, Singapore or Malaysia.
Considerations Before Applying For A Secured Loan

Taking out a secured loan is a pretty big financial decision that should not be taken lightly. Some things to consider before taking this route are:

Financial risk – you will be putting your home or other property assets on the line as security for the loan and these assets will be at risk if you fail to meet the repayments.

Early secured loan Repayments – paying back your secured loan early may seem like a good idea but some lenders may charge an early repayment fee if you do making the whole thing too expensive.

Multiple secured loan applications – avoid making a lot of secured loan applications to different lenders as this can adversely affect your credit rating. Using an experienced secured loan broker will not only give you access to the whole secured loan market but should ensure that the most suitable secured loan for you is obtained. Many people do not realize that making multiple applications for mortgages and secured loans with different lenders can reduce their credit rating and if they are refused enough times then they can damage their credit rating for the foreseeable future.

Secured loan term – secured loans can be typically repaid over five to twenty five years. Where smaller repayments over a longer period may seem an attractive option to keep your costs down, because interest would be paid over a longer term you may actually end up paying more in interest overall. UK Expat Pension Reviews can put you in touch with suitably qualified and experienced secured loan brokers who will be able to guide you through the process and give you transparent information about any fees that apply to your secured loan.

Secured loans are commonly used in the UK by property owners and landlords as a fast and easy way of raising money quickly for an emergency or for some short to medium term need. They will cost a bit more than a normal high street personal bank loan but because the loan is secured on the property the secured loan lender will have less risk of default and will often lend to people who have a less than perfect credit history.

What Is An Expat Secured Loan?

A secured loan is essentially a second charge mortgage which will enable a homeowner to borrow higher than normal amounts of money than a personal loan from a bank. £25,000 and upwards are the norm but often secured loans are arranged from as low as £10,000. Because the loan is secured on the equity held within the property, your home is the lenders security for the repayments and will be at risk if you fail to make your payments on time.

Reasons To Choose An Expat Secured Loan

Property upgrading – You may wish to upgrade your home but don’t have funds readily available and don’t want to re-mortgage the property and cannot raise enough through a personal loan. Applying for a secured loan could provide you with the funds you need before purchasing the new property.

Protect your expat mortgage – your mortgage may still be in its tie in period and to change it would attract large fees from your lender. Using a secured loan will allow your mortgage to remain unchanged yet you could obtain the money you need through a second charge on the property such as a secured loan in the UK.

Credit problems – if your credit rating has slipped for any reason it may be they you will be unable to raise money by re-mortgaging your property in the normal way due to your lenders changing lending criteria. A secured loan obtained as a second charge on the property will avoid the need to re-mortgage the property and could release the funds you need.

Short term secured loan – perhaps you know you will be able to repay a secured loan over say five to ten years yet you mortgage has 25 years to run. Obtaining money though re-mortgaging could cost you more in interest repayments due to the longer term of the mortgage. Although a secured loan may be more expensive to arrange initially having it for a much shorter repayment term could save you money.

*Remember we dont just helps expats based overseas we also help UK residents based in the United Kingdom for secured loans against their UK properties.

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UK Expat Pension Reviews specializes in Pension Transfers, UK expat pensions, Expat Life Insurance, Expat Mortgage Finance and Expat Savings and Investments. We offer comprehensive services tailored to the needs of expatriates. Our dedicated team provides expert guidance and assistance in evaluating and optimizing pension portfolios for UK expats worldwide. Whether you're looking to transfer your pension or seeking advice on maximizing your retirement savings, UK Expat Pension Reviews is committed to delivering personalized solutions and ensuring financial security for our clients.

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