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There are basically two types of loan available to you
in the UK. The first is a secured loan on the
value of your home and has several advantages and is
only available to homeowners or those repaying a
mortgage. The first advantage is that the lender has
more security and is therefore likely to consider more
adverse cases than with other types of loans. The loan
can be for a greater sum, up to £75,000 is common and
the repayment time can be extended to reduce your monthy
outgoings. The interest charged in percentage terms may
also be less as the lenders risk is reduced. There are
also unsecured loans these
are not secured on the value of your house and so there
is more risk involved for the lender. Therefore they
will not be able to offer you as much with this type of
loan. However if you are NOT a homeowner you will only
be able to apply for this type of loan.
You must take care when filling application forms. Some
brokers will only work with one or two lenders and so
may submitt your application to a lender which is not
greatly suited to your needs; this may result in a
rejected application. Each time you apply for a loan a
record will be kept of the access to your credit file by
the credit checking agency the lender uses, if they see
a lot of failed applications it can be a warning sign to
other lenders including credit card companies. Therefore
if you have a poor credit record it may make sense to
apply only to those lenders such as those listed above
that deal exclusively with poor credit loans.
If you still cannot obtain credit there may be a mark
against your name that you do not know about or that is
incorect. In which case you should first ask the loan
agency why you have beed refused or consult a credit
agency such as checkmyfile
Click here to register for your
Free credit report
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