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Secured Bad Credit Loans Make Sense
By: Gordon Goodfellow
Secured bad credit loans used to be seen with some contempt in years gone by.
Now they make complete sense, and people should be glad. Official UK figures
indicate why!
According to CreditAction.org.uk 'At the end of December 2005 the total UK
personal debt was £1,158bn. Total secured lending on homes in December 2005 was
£965.2bn. This has increased 10.4% in the last year.' This is when the average
United Kingdom domestic debt is £7,786, and that is excluding mortgages.
Average consumer borrowing through credit cards, motor and retail finance deals
has multiplied five fold in 5 years. Yet the typical house value in the UK in
Late 2005 worked out at £186,431 (source: Office of Deputy PM).
The figures tell their own story. The considerably higher interest payable on
credit cards, auto and shopping credit (store cards etc.) are taking a large
chunk out of the typical person's monthly earnings. The sole sensible way
forward is fairly clear. Consumers need to convert the high interest credit into
lower interest credit by using their property by way of security. Even if
people's credit standing is fairly low it makes more sense to pay off the same
amount of money at a lower interest rate by means of a secured bad credit loan.
Now new lending sources are springing up which take into account all
circumstances. This latest market for secured bad credit loans has grown up in
the last few years, and it has grown outside of the mainstay of the High Street
financial organisations. As long as borrowers have property then they may borrow
as much cash as they want to pay back existing debts. Nor do people have to pay
the outrageous interest that used to be the case with people whose credit
worthiness was not the best.
Would it not make sense to pay £60 a month in paying off that debt than £150 a
month paying off precisely the same amount? Secured bad credit loans offer that
opportunity.
Improvements in financial chance handling assessment mean that providers are
quite disposed to take into account secured bad credit loans where these were
unacceptable in the past. The self-employed, in particular, are not treated as
they were, notably with the new trend towards self-certification. Three years of
audited books are no longer automatically required from people who want to work
for themselves. People with CCJs, Individual Voluntary Arrangements, those who
have reneged on past or existing finance agreements or even discharged bankrupts
are now regularly considered in today's shifting world of credit.
Increasingly people are taking bigger financial chances, especially those in
business and the entrepreneurial minded. The secured bad credit loans market is
evolving to take account of that because it must. Of course, consumers should
not consider secured loans when they are not absolutely sure they are able to
meet the repayments. Those people should consider unsecured financial products
(which are more expensive).
But, as CreditAction.org.uk states, the average value of a property in the
United Kingdom is '£186,431 (£195,319 in England). UK yearly house price
inflation rose by 2.5 per cent. Annual house price inflation in London was 2.2
percent.' Putting all that money to positive use by taking out a secured credit
loan is an option most people should consider, whatever their credit rating.
About the Author:
Gordon Goodfellow is an Internet marketer, and market and social researcher. His
websites take into account all possibilities that a potential borrower might
present. For what this could do for you go to www.secured-bad-credit-loans.co.uk
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