Second charge mortgages from 5.1% APRC. Second charge mortgage representative example (If you choose to add fees to the loan).Assumed borrowing of £35,000 over 120 months, plus a broker fee of £2,870 and lender fee of £367.50 would result in monthly repayments of £476.14, the borrowing rate is 8.6%, the APRC is 11.2% (variable), total charge for credit would be £22,136.80 and the total amount payable would be £57,136.80. Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

Reasons to choose a secured loan

If you need to borrow a large amount

Personal loans are usually only available up to £25,000 so a secured loan or homeowner loan is a good option if you require a larger sum of money, as long as you have a realistic repayment plan.

Keep your low rate mortgage and avoid hefty exit fees

Should you have a low rate mortgage it may not be possible to remortgage to an equivalent or lower rate, plus some lenders may charge hefty exit fees.

Loans for any purpose

Secured loans can be used for most legal purposes. Due to the larger loan amounts and longer repayment terms available popular loan purposes can be home improvement, home extensions and debt consolidation.

To pay for home improvements

If you are planning large-scale home improvements, such as an extension, a secured loan can be a good option as you will be adding value to your property which you can recoup should you sell.

An easy repayment plan

Choosing fixed monthly payments makes budgeting easier. Use our handy monthly planner to help work out your expenditure, be realistic about what you can afford and we will find the most suitable term to fit your budget.

To consolidate existing debts

If you are paying interest on various unsecured debts such as credit cards, getting a secured loan to consolidate all your debts could reduce your monthly outgoings and simplify your finances. However, you should be aware that you may be extending the terms of the debt and increasing the total amount you repay.

Lower interest rates

Secured loan interest rates are usually comparably lower than for unsecured loans because they’re borrowed over a longer term. Headline interest rates on top secured loans start between 5 and 6%.

Getting approved for a secured loan

Getting approved for a secured loan can be easier than for an unsecured personal loan because lenders are more willing to accept applications from those with a poor credit history as the loan is secured.

For a secured loan you’ll need:

A credit history

Lenders are more willing to offer secured loans to those with a less than perfect credit history, but the amount you can borrow, loan terms and interest rates depend on your credit profile and circumstances.

A steady UK address

To be eligible for a secured loan you will usually have to have been a UK resident for at least three years and having a steady address will increase the chances of your loan application being approved.

A realistic repayment plan

Although the interest rates may be more favourable for secured loans, you must be confident you can make the monthly repayments on time.

Things to consider before getting a secured loan

It can be worth considering an insurance policy to protect your secured loan should you unexpectedly be made redundant or fall ill. Take advice on the right policy for peace of mind.

Taking out a secured loan is a financial decision that shouldn’t be taken lightly as you are putting your home or other assets the loan is secured against at risk if you fail to meet the repayments. Although repossession is the worst case scenario for a borrower, our expert advisors will work with you to ensure you have a realistic and affordable repayment plan.

Paying back your secured loan early may seem like a good idea, but some lenders may charge an early repayment fee. However, when looking at the various options available our qualified advisors can look for the most flexible loans that suit your particular needs.

The loan quotation you get will be based on your personal circumstances, to help ensure that the loan quoted will be the one you get. This protects your credit rating which could be negatively affected by making multiple applications with different lenders.

Secured loans are typically repaid over 5-25 years and while smaller repayments over a longer period may seem an attractive option, the longer the interest period, the more interest you will pay overall.

Our advisors will work hard to try and find you the most suitable option from our range of standard variable, tracker and fixed rate secured loans, based on your needs and circumstances. They will also offer transparent information about any fees that apply to your secured loan and what they mean to you, and your future plans.

Need guides to borrowing?

Our aim at Freedom Finance is to provide you with the information you need to make educated decisions when it comes to your borrowing and your money. The online financial market place is filled with conflicting, jargon-filled information about which loan product is the right one for you.

These deals may look attractive, but many of them apply only to those with an outstanding credit history. In reality, the best deal on offer might not be available to you. With our comprehensive finance guides, we aim to equip you with the know-how to make the best decisions about your borrowing and your money.

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Whether you're planning on some home improvements, replacing your car or simply getting your finances in order, a loan from Freedom Finance could be more affordable than you think. Use our calculator above to find the ideal loan for you. All quotations given are for illustrative purposes only. Credit subject to status. The rate you are offered will depend on your personal circumstances, credit assessment procedures and other related factors.