Glossary - Loan Security

Loan Security is lenders cover against loss on finance lent.
A lender can ask for protection on a loan, normally it would be the borrower’s home; this is in the event that the loan is not being paid.

The two main types of loans are Unsecured Loans and Secured Loans:
An Unsecured Loan is a finance that is repayable with affixed interest rate. With unsecured loans any property that you own would not be used as security for that loan. Therefore lenders have to take the consumers to court to recover any debts owed to them.
Secured loans are protected by being secured on a mortgaged property. Should a borrower default on payments then their property may be at risk. The lender could take possession of the property and decide to sell it to recoup the debts they are owed.

Useful Tip
The lender could be prepared to accept some other forms of security like land or buildings or some expensive antique. You should decide whether you are prepared to use your only home as security for a loan. So long as you make full repayments on time each month then your property would be safe.

Enquire Online for a FREE Loan Quote - UK LOAN ENQUIRY FORM
Enquire Online for a FREE Mortgage Quote - UK MORTGAGE ENQUIRY FORM

back to Glossary Index