Since the recession, secured loans have had their ups and downs with more changes witnessed in the industry than ever before.
Secured homeowner loans, since their inception almost thirty years ago, were always considered to be one of the first choices for homeowners who wanted to borrow for what ever purpose.
Secured loans have good interest rates, as being secured on the applicants property, loan providers feel safe in the knowledge that payment to the loan will aways be a priority for the borrower.
They were also so popular because they could be used for almost any purpose.
Homeowners often used secured loans as debt consolidation loans which meant that one low interest debt consolidation loan replaced all the high interest rate credit cards, personal loans, etc.
In the past homeowners, with little or almost no equity, could apply for secured loans thanks to lenders such, as Paragon, EPF and First Plus granting 125% equity loans.
While the self employed were never eligible for 125% secured loans, they could obtain a loan at 90% LTV and use a self certification of net profit in the process.
The credit crunch ended all this, and it was impossible to consider 125% plans as house prices tumbled.
Self certification of earnings stopped, and secured loan lenders demanded accounts, meaning that the self employed, who could not prove their income, found it impossible to obtain a loan.
Homeowner loan providers ceased trading one after the other and they are still out of the market.
One homeowner loan lender is again granting secured loans, as they have received funding from RBS. This is Link Loans who are now granting loans to self employed homeowners at a maximum equity of 60%. The borrower must also provide the last three months bank statements.
Secured loans are hopefully once again moving in the right direction with the advent of these self employed loans.
categories: secured loans,self employed loans,secured loan,self employed loans UK