Remortgages And Secured Loans Now And Then
Both secured loans and remortgages have a lot in common while at the same time they are different in some ways.
What connects them most concretely is the fact that they are both connected in some way to property.
Remortgages and secured loans are both ways to raise additional funds by borrowing and the sum that can be borrowed is dependent on how much equity there is.
Equity is the balance between the value of a property and the mortgage balance that is already secured on it.
Therefore if a home has a value of 340,000, and a mortgage of 200,000 secured on it, the available equity is 140,000
Until the recent crunch it was possible to achieve a remortgage of 100% of the property value, with the Northern Rock having remortgages and mortgages at 125%.
There are now only a few mortgage and remortgage lenders advancing as much as 90% LTV products and the rate for them are fairly high at up to or even slightly more than 6%.
At 90% LTv these rates are very costly, when we consider that there are rates of less than 2% for both a mortgage or a remortgage if the applicant has a deposit of 30% or sometimes 40%.
Secured loans which like their close relative the remortgage depend on property equity have very much stricter equity margins now than they did brfore.
One homeowner loans provider has a 60% LTV plan for self employed homeowners who have only been in business for a minimum of six months.
These self employed loans are very useful to the self employed who have struggled for the past two years to obtain a loan of any kind and who require full accounts for a remortgage.
The 60% self employed loans are very handy for the poor old self employed who have been unable to get a secured loan or a remortgage over the last three years.
In spite of the few changes to secured loans and remortgages, one thing tht has remained constant is the fact that they can still both be used for a multitude of reasons, including debt consolidation.
Want to find out more about secured loans then visit Champion Finance's site on how to choose the best remortgage for you.