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Debt consolidation, home improvement

5 Reasons You Need a Fixed Interest Rate Equity Home Loan

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Fixed rate mortgages are the most popular type of home loan in the UK. If you are looking to borrow against the equity in your property, a fixed rate equity home loan is also a great solution. Here are five reasons why you should consider this type of loan.

1. Security

One of the main reasons why fixed rate loans are the most popular in the UK is that they provide security. Interest rates are notoriously volatile, reaching over 15 per cent in the early 1990s. With a variable rate loan, every time the interest rate changes, your payments will change. And, with interest rates at an all time low, it may well mean that your payments may rise when the Base Rate starts to increase.

With a fixed interest rate equity home loan you do not have any uncertainty. Your interest rate and payments are fixed for a certain period at the outset so you know exactly what you will pay. Whatever happens to interest rates in the meantime, you have the security that you know precisely what you’ll pay on your homeowner loan every month.

2. One simple monthly payment

Rather than having a number of credit cards and personal loans, an equity home loan allows you to borrow a fixed amount with just one monthly payment.

You may have small amounts on a number of credit cards and be struggling to keep track of what to pay to whom. With a fixed interest equity home loan you can borrow a set amount and know exactly what your repayments will be. One lender, one loan, one direct debit.

3. Allows you to budget

With a variable rate secured loan, your payments can change at any time. If interest rates rise and fall your payments may rise and fall accordingly.

Many people choose to take a fixed interest equity home loan as it means their monthly payments are guaranteed and certain. You know exactly what you have to pay to your loan every month and so you are able to budget much more effectively.

4. Can be used for almost any purpose

Fixed rate equity home loans can be used for practically any purpose. You can borrow money secured against your home on a fixed interest rate basis to:

  • Buy a new car, van, SUV, truck or motorcycle
  • Consolidate existing debts
  • Fund home improvements or a new kitchen or bathroom
  • Pay for a dream holiday
  • Pay for your wedding or honeymoon

With a fixed rate loan you can choose the amount you wish to borrow and the term of the loan. You will then know exactly what your repayment will be, allowing you to keep control of your finances.

5. Consolidate variable rate debts

You may have a number of credit card balances or personal loans on a variable rate basis. Rates can change frequently, and so it may be difficult to keep up with what interest rates you are paying on your debts.

A fixed rate equity home loan allows you to borrow the amount you need to repay your existing debts. You will then pay one, simple, affordable monthly payment to your secured loan. And, what’s more, as the interest rate is fixed you do not have to worry about what happens to interest rates as you’ll always know exactly what your payment will be.

So, whatever you need to borrow for, consider a fixed rate equity home loan. You’ll benefit from the peace of mind of a fixed rate with the simplicity of one simple, monthly payment.

To use your home to raise money at a competitive APR, please fill this homeowner loan form.

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