Bad Credit Loans Make Sense
FOR RELEASE 27 February
Secured Bad Credit
Loans Make Sense
Secured bad credit
loans used to be looked upon with some derision in years gone by. Now
they make complete sense, and we should be glad. Official UK figures
show 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 12 months. This is while the average UK household
debt is £7,786, and that is excluding mortgages.
Average consumer borrowing via credit cards, motor and retail finance
deals has grown five fold in 5 years. Yet the average house price in
the UK in November 2005 stood at £186,431 (source: Office of Deputy
The figures speak for themselves. The much higher interest rates payable
on credit cards, motor and retail finance (store cards and the like)
are taking a huge chunk out of the average persons monthly budget.
The only sensible way forward is quite clear. Consumers need to convert
the high interest debt into low interest debt by using their property
as security. Even if peoples credit rating is quite poor 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 new market for secured
bad credit loans has opened up in the last few years, and it has
grown outside of the mainstay of the High Street banks. As long as consumers
have property then they can raise as much cash as they like to pay off
existing debts. Nor do people have to pay the exorbitant 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 servicing that debt
than £150 a month servicing exactly the same debt? Secured bad
credit loans provide that opportunity.
Improvements in financial risk management assessment mean that lenders
are quite prepared to consider secured bad credit loans where they were
not acceptable in the past. The self-employed, in particular, are not
treated as they used to be, especially with the new attitude towards
self-certification. Three years of audited accounts are no longer automatically
required from people who choose to work for themselves. People with
CCJs, IVAs, those who have defaulted on past or existing credit agreements
and even discharged bankrupts are now regularly considered in todays
changing world of finance.
Increasingly people are taking bigger financial risks, especially those
in business and the entrepreneurial minded. The secured bad credit loans
market is expanding to take account of that because it has to. Of course,
consumers should not consider secured loans if they are not absolutely
sure they can 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 house in
the UK is £186,431 (£195,319 in England). UK annual
house price inflation rose by 2.5%. Annual house price inflation in
London was 2.2%. Putting all that capital to good use by means
of a secured credit loan is an option most consumers would consider,
whatever their credit rating.
The writer is an
Internet marketer, and market and social researcher. His websites dealing
with secured bad credit loans take into account all possibilities that
a potential borrower might present. For what this could do for you go
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© 2006 Inteltab