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Secured Bad Credit Loans Make Sense
By Gordon Goodfellow
Secured bad credit loans were looked upon with some contempt in times gone by. Now they make total sense, and people should be glad. Official UK statistics tell us 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 household debt is £7,786, and that is not taking into account mortgage debt.
Average domestic borrowing via credit cards, vehicle and shopping finance deals has increased 5 times in five years. Yet the average house price in britain in Late 2005 worked out at £186,431 (source: Office of Deputy PM).
The numbers tell their own story. The much higher rates of interest levied on credit cards, auto and retail finance (store cards etc.) are taking a considerable chunk out of the average person's monthly earnings. The single sensible way out of this is quite obvious. Consumers need to convert the high interest credit into lower interest debt by making use of their property as security. Even if people's credit worthiness is quite low it makes even more sense to pay off the same amount of money at a reduced interest rate by means of a secured bad credit loan.
Now new lending sources are springing up which consider all circumstances. This latest market for secured bad credit loans has opened up in the last few years, and it has developed outside of the mainstay of the High Street financial institutions. As long as consumers have property then they may raise as much cash as they want to pay back existing debts. Nor do intelligent consumers have to pay the outrageous interest rates that used to be the case with people whose credit rating was not perfect.
Would it not make sense to pay £60 a month in paying off that debt than £150 every month servicing exactly the same debt? Secured bad credit loans provide that opportunity.
Improvements in financial risk handling assessment mean that lending sources are readily disposed to consider secured bad credit loans where these were not considered in the past. The self-employed, especially, are not treated as they were, especially with the recent attitude towards self-certification. Three years of audited accounts are no longer automatically required from those who want to work for themselves. People with CCJs, IVAs, people who have reneged on past or current loan agreements or even discharged bankrupts are now regularly considered in today's shifting world of finance.
Increasingly consumers are taking larger financial chances, especially those in business and the entrepreneurial minded. The secured bad credit loans market is expanding to take account of that because it needs to. Of course, borrowers should not consider secured loans where they are not perfectly certain they are able to meet the repayments. Those people should look at unsecured loans (which are more expensive).
But, as CreditAction.org.uk states, the average value of a home in the United Kingdom is '£186,431 (£195,319 in England). United Kingdom yearly house price inflation went up by 2.5 percent. Annual house price inflation in London was 2.2 per cent.' Putting all that money to proper use by taking out a secured credit loan is an option most people would 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
Article Source: http://www.simplysearch4it.com/article/22348.html
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