Secured loans are obviously, as their name clearly states, a form of loan that must be secured against an asset. There are numerous types of secured loans, but here today we want to discuss the secured homeowner loan.

Secured loans can be guaranteed by the equity on your main residence or even on your holiday home. However not many people are lucky enough to own a second home.As these are secured loans non homeowners cannot apply, and if a tenant requires a loan, the only option is an unsecured loan. Unsecured loans are few and far between at present even for homeowners.

For a homeowner thinking of buying a car, caravan, motor home, etc. a secured loan can be used. As long as it is legal the secured loan can be used for almost any purchase, including such things as holidays, weddings, etc.

The secured loan is based on equity, and what equity is is the amount left when the mortgage balance is taken away from whatever the property is worth.If someone has a mortgage of say 160,000 and the property has a value of 250,000 the equity is 90,000.

So saying it is not possible since the advent of the recession to borrow up to 100% of the value of the property as it was until 2007. Then there was even the 125% equity plan where by it was possible to borrow up to 25% above the value of the property.

Since the credit crunch there are no longer any 100% let alone 125% equity plans. The LTV now are for employed secured loan borrowers and self employed secured loan borrowers are 80% and 70% respectively. So saying the maximum available secured loan would be therefore be 40,000 and 15,000 respectively, based on the figures already given as an example.

For homeowners wanting a secured loan but with a poor payment profile, bad credit loans still exist, but are much restricted from their position. Prior to the recession extremely adverse credit loans were available at 75% LTV.

Even homeowners on the verge of having their homes repossessed due to serious mortgage arrears could obtain these bad credit loans.Sometimes it was no bad thing, as the mortgage arrears could have been due to ill health, redundancy and no blame could be attached to the poor unfortunate homeowner.

In the current economic climate bad credit loans are still available with an equity restriction of a maximum 60%. Two secured loan lenders one of which is First European Securities still grant bad credit loans to homeowners with unlimited adverse at 50% loan to value.

If a homeowner has extremely bad credit the biggest secured loan that these two bad credit secured loan lenders advance is 25,0000 or there abouts. 50% LTV is very tight but if a homeowner has sufficient equity a bad credit secured loan at even 25,000 could help him out.

Therefore to sum up bad credit loans are available but with much stricter underwriting criteria now than two years ago.

Champion Finance has been established since 1985. They arrange secured loans for all circumstances. Whole of the market remortgages , and mortgages are also available.

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• Is the Economy Really Improving as Yet Another Secured Loan Lender Collapses?.
• Remortgages, Secured Loans and Homeowner Loans Can Really Add to the Quality of Life.
• Remortgages, Secured Loans and Homeowner Loans Are Not Only for the Boring Things in Life.