How a Secured Loan on Your Home Can Help You Finance Your New Car

Are you looking to buy a new car?

Official figures show that there were over 1.3 million new cars sold in the UK in the first eight months of 2010, with Ford, Vauxhall and Volkswagen the three most popular auto brands. Paul Everitt, the Chief Executive of the Society of Motor Manufacturers and Traders (SMMT) recently said that “demand for new cars has stabilised and will end 2010 slightly up on last year.”

A new car may well be one of the largest purchases that you ever make, and so it is imperative that you find the correct way to finance your new vehicle.

So, if you are looking to buy a new motor, why not consider a homeowner secured car loan?

Homeowner Secured Car Loans

A secured homeowner loan allows you to borrow a sum of money secured against the equity in your home. A homeowner loan is secured against your property and you can typically choose the amount you wish to borrow (based on the equity in your home) and the term of the loan.

You are generally free to use the money from your homeowner loan as you see fit, which is what makes it an excellent choice if you are looking to buy a new car.

You have to keep up repayments on your secured homeowner loan otherwise your property is at risk.

Advantages of a Homeowner Secured Car Loan

There are various reasons why a homeowner secured car loan is a good way to finance the purchase of your new automobile.

Firstly, homeowner loans can often offer better interest rates than car finance. Car loans are often arranged on an unsecured basis, meaning that there is more risk to the lender. The lender has no asset that they can repossess to repay the debt should you fail to keep up your repayments. This often makes unsecured lending more expensive than a secured loan.

Secondly, car finance often requires you to have an impeccable credit history. Many car dealers or banks use credit scoring to determine whether you are eligible for the auto finance that you need. Even if you have a small blemish on your credit file, you may struggle to be agreed for a car loan.

However, many secured loans do not have such strict underwriting criteria. As the lender is taking a legal charge over your property, they have an asset which they can call upon if you fail to keep up your repayments. If you don’t pay, they can get their money back through ultimately forcing you to sell your home.

Flexibility and Affordability of Secured Auto Finance

When buying a new Ford or Nissan, you will have a budget that you want to work towards. Car financing plans can often be complicated and cost a significant amount on a monthly basis, especially if they are set up over a short period (3-5 years). Many of them also insist that you buy the car outright at the end of the plan or have penalties if you wish to repay the finance early.

A homeowner secured car loan will typically be regulated by the Consumer Credit Act and so will have minimal penalties if you wish to pay off the loan early. You also have the choice of taking the loan over a longer period in order to keep your monthly automobile payments within your monthly budget.

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