A secured loan is a loan where you will be required to use your property as security against the loan, so the lender is able to balance the risk of lending to you. The amount that can be borrowed differs from lender to lender and your individual circumstances. The amount that can be borrowed, the term available and the Annual Percentage Rate (APR) will depend on:

In the UK, secured loans, which are often referred to as homeowner loans, require you to offer the lender security against the loan, so they are able to balance the risk of lending to you. With the vast majority of secured loans, this will be your property.

If you own your home, there is an additional loan option available to you. In addition to personal loans, there are also loans that are secured against your home. Because your home is used as security for repayment, these secured loans are also commonly referred to as homeowner loans.

By taking out a secured loan, you are borrowing money that is secured against your assets, usually your property. So it's wise to consider very carefully before going down this route, as you could lose your home if you cannot keep up the repayments. Always make sure that the cheapest secured loan you find in the UK does not become a very expensive one.

Secured loans, like personal loans are subject to market forces and competition amongst providers. There are multiple providers whose rates change regularly with low rates of interest being offered to attract customers. Shopping around and comparing secured loans, rather than responding to the first ad you see, means you are more likely to find the best deal for you.

It is often essential to raise finance for major purchases including for example house related investments such as adding a conservatory or a loft extension. One method for raising this finance is to borrow money with security put down against the loan. This effectively guarantees the loan by assigning rights to the security in the event of a loan default. Such a loan backed by collateral is usually called a secured loan.

People who have multiple debts from credit cards might find that a secured loan helps them to consolidate the balances and simplify the repayment process.

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