What Is A Secured Loan

A Secured Loans



What is A Secured Loan?

A secured loan means that you borrow a sum of money and use your home as collateral. You can borrow anywhere from $50,000 to $150,000 and use it for any purpose. These loans rely on your collateral and your ability to repay more than your credit score. If you fail to pay back the loan, the lender will take your home and sell it to recoup the money that you owe.

 

This particular type of loan has flexible payment terms, allowing you anywhere from 3 to 30 years to pay the funds back. They also offer borrowers a fixed monthly payment plan that allows borrowers to budget their money accordingly every month without any surprises. Depending on the amount borrowed, you can receive your funds quicker than an unsecured loan; typically within 48 hours after acceptance.

 

Advantages Of A Secured Loan?

Consumers have access to many benefits when they choose to get a secured loan over an unsecured loan. The main benefit is the ability to borrow a larger sum of money by using your home as collateral. Lenders will see you as less of a risk then they would if you were to get a loan without collateral. More so, lenders typically offer borrowers a lower interest rate on secured loans then they do on unsecured loans which will help keep your payments lower and the amount you pay back smaller than an unsecured loan.

 

In addition, a secured loan allows you to get a loan even if you have less than perfect credit. By offering your home as collateral, lenders will see those with bad credit as less of a risk to lend money to then those trying to get a unsecured loan with bad credit.