Home  Mortgages-Refinance A Remortgage Or A Secured Loan Is The Best Way For Homeowners To Obtain A Loan.
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A Remortgage Or A Secured Loan Is The Best Way For Homeowners To Obtain A Loan. |
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Written by LizMoir
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Tuesday, 02 March 2010 |
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Amongst the loans that form the home loans group are two types of home loans and these are secured loans and remortgages and non homeowners cannot apply for these two loans as they both need some form of security which in this case is the bricks and mortar value of a property. This makes remortgages and secured loans only available to those who actually own their property.
by LizMoir
Amongst the loans that form the home loans group are two types of home loans and these are secured loans and remortgages and non homeowners cannot apply for these two loans as they both need some form of security which in this case is the bricks and mortar value of a property. This makes remortgages and secured loans only available to those who actually own their property.
When a home loan is secured it means that the interest rate attached to the secured loan or remortgage is usually lower than the unsecured loan interest rate. This is a result of the lender feeling that he is in a much stronger position as regards the borrower meeting all the loan payments.
The rates of interest for secured loans and remortgages are normally much lower than that of unsecured loans where the loan lender is taking a greater risk, as if the borrower defaults in repaying, the lender can do little about it apart from taking out a default or CCJ against the borrower, and if the borrower is a homeowner the lender can take out an inhibition which is like a County Court Judgment secured against the property. This inhibition is registered at the Land Registry, and the homeowner is unable ever to sell his property without first paying off the inhibition no matter how much the inhibition is for.
This however means that the lender can have a very long wait before he receives the loan back that he granted that particular borrower, especially if the borrower stays on at the same address for a long time. If the borrower chooses to remain at the same address forever the lender may never be repaid.
The first security registered on a property is the mortgage, and an inhibition is registered as a security in exactly the same way as the mortgage. This means just as the mortgage has to be repaid when the property is sold so has the inhibition to be paid back in exactly the same way.This means that at some time or another even if in the distant future, the granter of the loan will receive the money back which he originally lent although he may have to wait some considerable time for it to happen.
Remortgage rates start at 1.98% for a tracker remortgage or mortgage if the prospective borrower has a maximum LTV of 60%, and this rate is the lowest in the history of the mortgage industry
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Last Updated ( Wednesday, 05 May 2010 )
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