What you must know about secured loans, mortgage and Remortgages
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Secured loans and remortage are generally closed related as they are loans given out to home owners while mortgage is the type of loan given out to intending house developers.
A mortgage can be a loan that is used in buying property and also serves as a loan for property development while secured loans and remortgages are loans given out to home owners.
This imply that one does not need to be a house owner before you can apply for a loan but you are expected to own a home before you can apply for a secured loan or a remortgage loan.
However , it is getting difficult for starters in housing mortgage business to be get loans now in this recession era as compare to the pre recession era where loans up to 100% of the mortgage was usually getting to any body ,which is one of the causes of the crumbling of the US economy and the World economy at large.
For example in the United Kingdom, the Northern Rock even advanced out loans up to 125% of the mortgage meaning that 100% covered the mortgage and was a secured loan while the 25% is meant to be an unsecured loan.
When the recession period started , even first time buyers were compel by the loan lenders and bank to either rent or lease a house instead of buying as they could not meet up with the 25% down deposit before a loan could be granted.
But we have lenders that can still advance you loan up to 80% of the money even for first time buyers of mortgages.
Also mortgage are also required from those that need to buy their second property due to this economic recession period and lenders are setting up more stringent conditions before loans could be advance out to mortgage buyers. They are expected to hve made a profit from the sale of their first property, hence a deposit is needed from them by the lenders before they can get a mortgage to cover a more expensive property that they need to buy.
Remortgage is the taking of a mortgage from a different mortgage provider that is different from the one you are use to get a mortgage before. It is meant to get additional money or a low interest rate .
Most homeowners prefer to take a second loan as a re mortgage at the end of their current loan transactions mostly from a different mortgage provider so that you get a lower interest rate as interest rate varies from one lender to another and also to get a faster approval.
Secured loans are home owners loan , which can be used to purchase a car , a new house ,sponsor a trip or wedding while mortgage and remortgage are secured on the property. Mortgage and remortgage can also be called debt consolation loan as they save money by uniting all high interest loans into the one.
The main difference between a secured loan and a remortgage is that a secured loan stands on it own as a separate transaction while a remortgage is meant to replace an existing mortgage.These various types of loan may be similar but you just need to understand the various terms and conditions attached to them base on the information provided above and also you need to read terms and conditions thoroughly before you sign up for any loan package or get the advise of a loan expert to help you in the right choice of loan to take that will serve your short term and long term needs.
What you must know about secured loans, mortgage and Remortgages
By: Aniekan Udobong
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