Secured Loans

No equity situations can arise when there is a reduction in your property’s market value. Also for some new homeowners there is no equity in their property as they have taken a 100% mortgage to purchase their property as yet the value of their property has not increased nor has their mortgage reduced due to repayments.

Equity is the difference between the total borrowings secured against your property against the value of that property.

Example

Your home is worth

The mortgage with your Building Society is for

The difference is your equity in the property

£100000

£80000

£20000

The Bad News First

Most lenders will need to access the equity available within your property for you to qualify for a secured loan. They will have criteria within their loan plans that will only allow you to borrow up to a certain percentage of you property value.

For example

A lender will only allow up to 90% loan to value , meaning the loan they will allow when added to any other borrowings against the property cannot exceed 90% of the property value.

So on a 90% loan to vale plan (LTV)

Your home is worth

The mortgage with your Building Society is for

A 90% plan LTV plan means your total borrowing
against your property cannot exceed

The current mortgage with the Building Society is for

Leaving a loan available to you of

£100000

£80000

£90000

£80000

£10000

The Consequence

So if you have no equity as you owe to your mortgage company an amount that is the same as the property value then your options on using your property as security for a loan and consequently getting a better deal are reduced.

What can I do?

Contact Edwards & Associates apply online

Why, what can you do to help me?

The Good News

Provisions have been made to arrange loans for homeowners with little or no equity or even negative equity (when the amount owed on your mortgage is more than your property value). We have relationship with lenders who will review your application on case-by-case basis and consider your property value for its suitability before making any decisions. Some of the plans available allow borrowing totalling 120% of your property value

So in the example above the amount available to borrow may be increased subject to terms and conditions. Look at the difference

So on a 120% loan to vale plan (LTV)

Your home is worth

The mortgage with your Building Society is for

A 120% LTV plan means your total
borrowing against your property cannot exceed

The mortgage with the Building Society is for

Leaving a loan available to you of

£100000

£80000

£120000

£80000

£40000

That’s a big difference and could mean a multitude of new options to you the borrower. Further home improvements, consolidate other debt, a holiday and a new car purchase may be realised from one loan.

What do I need to consider?

These types of plans will may have on occasion a higher interest rate than perhaps other plans that do not lend over the value of your home as there is a greater risk in the lenders eyes. You should always be clear about the terms of any agreement you enter into.

What do I do now then?

Rejoice, as if you are a Homeowner with no equity in your property and need a loan. We through our stratigic parners will contact one of our specialist lenders that deal with your personal circumstances to arrange your loan once your completed application form has been received. Just click below on the “apply now” button and you will be contacted shortly thereafter with a decision in principle.

To apply click here

Back to main Secured Loans page

All loans are subject to status, written quotations are available on request. A Typical example would be £15,000 over 120 months @ £201.80 per month = £24,216.00 Total amount repayable (10.9% APR Variable)

YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR OTHER LOAN SECURED ON IT.

top of page