Secured Debt Consolidation Loans

There are various types of debt consolidation loans available, but each is designed to help you combine your debts into a single, manageable sum, and provide you with peace of mind when repaying. With fixed rates and debt consolidation loans for bad credit available, this is a choice that could prove to be beneficial to a variety of people. On this page, we will be discussing secured debt consolidation loans, what they are used for, and how they are different to unsecured consolidation loans. That way, you will be able to determine whether they are a good option for your needs.

  • Years of experience in the finance industry
  • Large panel of consolidation loans lenders
  • Personal approach to application reviews
  • Bad credit applications considered
  • Easy online application process
  • FCA authorised, responsible broker service

We are a debt consolidation broker service who use a large panel of lenders to find the perfect loans for you. We take the time to personally check each application for affordability, then choose one of our trusted lenders as the best solution for you. This means that we take out all of the hard work for you, finding and comparing the best deals as quickly as we can. Once we have found the best secured debt consolidation loans to suit your requirements, the lender will contact you to finalise your application.

If you are ready to start your application, simply apply online and our team will begin reviewing your affordability to reach a lending decision.

Secured Debt Consolidation Loans | Debt Consolidation Loans

What Is A Secured Consolidation Loan?

A secured consolidation loan allows you to merge your existing debts into one figure, making it easier to manage repayments. However, this type of loan is not suitable for everyone as it is secured against an asset, offering security for the lender. A provider will review the borrower’s assets (also known as collateral) to determine how financially viable the applicant is, based on the value of their possessions. This means that a secured loan will be issued based on the financial value of a borrower’s collateral.

As this type of loan is secured against an asset, if you do not manage to make repayments on time, your chosen possession could be repossessed. Typically, secured debt consolidation loans use your property as collateral, so if you default, there is a chance you could lose your home. For this reason, it is essential that you ensure you can repay your loan on time and in full each month. If you are not confident about repaying, you may want to consider other consolidation options.

How Much Are Secured Debt Consolidation Loans?

Usually, secured loans have cheaper interest rates than their unsecured counterpart. This is because with a secured consolidation loan, the lender has assurance from the chosen collateral, so can lower the interest rates to suit. With unsecured loans, there is no form of security, so they tend to be more expensive due to the added risk to the lender. However, while secured loans may be cheaper, they can be more risky to borrowers if there is a chance of defaulting.

At Debt Consolidation Loans, we aim to find an option that suits your needs and affordability. This means that if we think you will not be able to afford repayments, we will decline your application to avoid leaving you out of pocket. However, if we review your monthly income and essential outgoings, and can see that you will be able to comfortably repay each month, then we may proceed with your application. This applies to our range of consolidation loan offers, including debt consolidation mortgages and credit card consolidation loans. We keep our customers’ best interests at heart and would never allow anyone to borrow more than they could afford, so we can ensure that you are in responsible and trusted hands.

Why is it worth consolidating ALL your debts into one loan?

  • You can control your monthly budget
    A loan will help you manage your personal finances, as it’s only one payment – not many. 
  • Reduce the total amount you owe
    If the combined total interest of all your debt is higher than having one loan interest rate, you will actually save money.
  • Improve your future credit score
    You can take the opportunity of having one payment each month to prove that you are a responsible borrower. Therefore, it will have a positive effect on your credit rating.

 

What Are The Advantages Of Secured Consolidation Loans?

If you are creating your own comparisons to find out which type of loan is best for you, there are several benefits to secured loans to consider. This includes:

  • Longer terms – a secured debt consolidation loan is a type of long term loan. This means that you can repay over a number of years to suit you, potentially offering a more manageable monthly payment.
  • Larger amounts – you can usually borrow more money than you would be able to with a personal consolidation loan. These are typically capped at £25,000, so if you need more money for a larger purchase, you may want to consider a secured loan.
  • Lower interest rates – as secured loans use an asset as assurance for the lender, many are able to offer lower interest rates. This could make them cheaper than other types of loans, such as unsecured or even credit cards. Make sure you shop around to find providers that offer the best secured debt consolidation loans for your needs, and compare them to other options to check the rates.

What Are The Disadvantages Of Secured Consolidation Loans?

Along with the advantages, there are also several disadvantages to secured loans to consider. This type of loan is not suited to everyone, so it is essential that you weigh up the pros and cons carefully to determine whether this type of loan is the right choice for you. The disadvantages include:

  • Added risk – for this type of loan, you will be required to offer an asset as collateral, such as your home. If you default on your loan, this asset may be repossessed. If this is a loan that you considering applying for, it is key to make sure that you can afford repayments to avoid losing your belongings.
  • Added charges – some secured loans can attract extra charges, including a lender arrangement fee and valuation charges.
  • Repaying more overall – as the repayment terms can be longer than those attached to other loan types, you might end up paying more over a longer period of time. This all depends on the length of your repayment term and your interest rate, so do some soft searching before applying to find a solution that works best for you.

Before you apply for secured consolidation loans, it is crucial that you review your current monthly income and how long you will need to repay in full. If you feel as though you will struggle to make repayments, there are several alternatives to consider. You could try to improve your credit score for other types of financial products, use your savings for your purchase, or become a member of a credit union. If you need more support with your finances, please seek impartial help from the Money Advice Service.

Choose Us For Your Secured Debt Consolidation Loans

At Debt Consolidation Loans, we are proud to keep our customers’ best interests at heart. We personally review all applications for affordability and take the time to understand our customers’ needs, which means we can cater to people in a range of financial positions. We will do everything we can to ensure you can make repayments if you urgently need cash to help, even if you have been turned away by other lenders or brokers. However, if we felt that you would struggle to comfortably make repayments, we would need to decline your application for your own wellbeing.

We offer flexibility in our repayment plans, and with our secured consolidation loans, you will be able to make payments on a pre-agreed date each month. This can give you peace of mind when it comes to managing your budget. We also pride ourselves on our transparency, so our soft search will not damage your credit rating and there are no fees for using our service.

If you would like any more information, check our FAQs or feel free to contact us. If you are ready to start searching for consolidation loans, please apply now.