What is a secured loan?

A secured loan is a loan secured against a personal asset. In most cases this is a property and therefore why secured loans are often referred to as homeowner loans. The loan is secured against your property giving the lender legal repossession rights if the repayments are not met.

The market will offer far more competitive rates for secured loans rather than unsecured loans (loans not secured by an asset). This is due to the added security that the lender possesses if a loan is secured against a property that they know can be repossessed.

This is why taking out a secured loan requires careful consideration of your financial budget to ensure that you can cope with the monthly repayments.

Go Back to the main Secured Loans FAQ page