An explanation of homeowner loans

We are always keen to make sure you understand the nature of the homeowner loans options available to you and are always very happy to answer your questions whether over the telephone or via email. In the meantime, however, here we explain the concept of loans for homeowners.

Loan costs

The cost of a typical loan is related to many things, one of the most important of which is a potential lender’s view of the risks involved in advancing the money.

A loan provider will look at a number of aspects of an application to try and decide what they mean in terms of your (ie as the applicant) ability to repay the loan and, as a result, the risks they will be taking in lending the money.

These aspects may include things such as:

• your income levels and existing monthly expenditure;
• whether you have any existing credit;
• details of your employment;
• the purpose of your loan;
• your credit history records;
• your residency status (where you live, how long you have lived there and whether you own or rent the property you live in etc).

Homeowner loans

If you are a homeowner, it is typically a significant factor in communicating to potential lenders that you may be a lower-risk applicant.

It may also tell them that you have a significant financial asset that could, if you so choose, be used to secure your loan (effectively meaning that you will be guaranteeing the loan against your property).

What this means, specifically, may vary between lenders.

Some lenders may give significant weight to the fact, on its own, that you are a homeowner.  That fact may help you obtain an unsecured loan at slightly lower interest rates than may be the case if you were not a homeowner.

If you choose to secure your loan against your property, that may enable lenders to see that their risks will be lower, which in turn, may allow you to borrow larger sums  - and potentially at even more attractive interest rates than with an unsecured loan.

Being aware

If you are considering homeowner loans for the purposes of obtaining competitive interest rates or larger loan amounts, you should keep in mind that your home may be at risk of repossession if you do not keep up the repayments.

In summary, if you are a homeowner, there are a number of loan solutions that may be available to you. By using our service, we can help you find homeowner loans that may be the most suitable for your needs.