Prior to the credit crunch, secured loans were a very well loved path for homeowners to raise money.
A secured loan is a product that is only available to homeownes since, as their very designation makes clear, they require to be secured on a firm sort of asset which in the condition of secured homeowner loans is the borrower’s property.
Prior to the credit crunch, nearly every homeowner was eligible for homeowner loans, providing they had resided at their property for a minimum period of six months much if they had a 100% mortgage due to the ready availability of 125% secured loans.
The 125% loan to value plans, which were available from some lenders, meant that a person could borrow up to 25% more than his property was worth, and the maximum loan for this plot was £60.000.
This type of secured loan only applied to employed applicants who had a excellent credit rating, and the self employed were excluded.
However, self employed applicants in those days were able to obtain a loan of up to £70.000 at 100% loan to value, and self declartions of income were acceptable much on this high risk plot.
For self employed wanting to borrow more than this sum, secured loans were in the market at up to a maximum value of £250,000 at 90% loan to value, and these loans were available to both employed and self employed customers.
One lender was much prepared to advance these very high loans on a self certification basis to self employed and employed alike which seems hair raising to reckon about immediately.
During the credit crunch, major changes took place, and self declarations of income disappeared, as did all high equity plans.
In the years between 2007 and 2010 loans to value were restricted to 65% for self employed human beings and 75% for those in employment.
This lead to far fewer homeowners being able to apply for homeowner loans, and as the applicants fell so to did the loan providers who had so hardly any secured loan applications that their business was no longer viable, and the numbers decreased from over twenty to just a handful.
Slowly however surely, matters started to improve and loan to values were increased by 10% across the board.
In this contemporary year there have been further improvements witnessed with self employed loans being available without accounts as extended as the homeowner has a loan to value of 60%, and with fresh lenders such as Central Lending and Portal Portfolio entering the market, it all looks like a bit of a revival for secured loans that are so useful for so many purposes, including their employ as debt consolidation loans.
Champion Finance has been established since 1985. They provide whole of the market mortgages, remortgages and secured loans . Helpful, sympathetic debt advice, debt managemet, debt consolidation and all other debt solutions are also available.When looking for a secured loan, remortgage, etc. look no further than Champion Finance.
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