The importance of trying to compare secured loans

by Ceri Harris14.01.2014

It is difficult to overemphasise the importance of being able to compare secured loans before you actually make your final selection.

You should not lose sight of the fact that, as someone that would like to borrow money, you are a potential client of lenders and not someone that is seeking a special favour.

You are looking to place your business with an appropriate provider of finance and they, in turn, will be looking to make a profit out of the funds they advance to you.

This means that both parties typically should take steps to ensure that they are happy with the proposed deal – for you that means being prepared to objectively compare secured loans, one against another.

The provider’s considerations

The potential lender will be taking steps to protect their interests by asking for certain information about you, typically using this, along with credit scoring techniques, to decide if they will be willing to lend to you, and if so, at what price.

Your considerations

You, on the other hand, may be considering things such as:

  • how much your borrowing is going to cost you;
  • how quickly, on average, will the potential lender be able to get the funds to you;
  • what security the lender may require as part of the advance (secured loans are perfectly normal and the asset you use as security cannot be touched providing you maintain the loan repayments in accordance with the agreement);
  • what is the maximum sum available based upon your income and other factors;
  • are loans available for all purposes or do restrictions apply;
  • what is the potential loan provider’s view of credit history problems – do they provide bad debt loans, for example;
  • are there any special terms you need to be aware of, such as an early repayment charge (where, if you can afford to pay the loan off early, whether you will be charged a fee for doing so) etc.

All of these things may significantly affect your views as to the suitability of a given loan proposition for your individual situation.

It is only by being prepared to compare secured loans that you may be able to satisfy yourself that you have found an answer to your funding requirements. Alternatively, our service can do this for you, by identifying the most suitable lending proposition for you.