Homeowner Loans
You could receive your loan in as little as 3 days!
- Borrow from £10,000 to £250,000
- Flexible terms from 3-30 years
- We consider all credit histories
- Employed, self employed, pension and benefit income
- Direct lender so no broker fees
Representative Example: A secured loan of £31,000 payable over 7 years on a fixed rate of 9.83% for the first 5 years, followed by a variable rate, currently 9.69%, would require 60 monthly payments of £553.17 followed by 24 monthly payments of £552.39. The total amount repayable would be £46,447.56, this includes interest, an arrangement fee of £1,999 and a processing fee of £499. The overall cost for comparison is 13.1% APRC representative.
What is a homeowner loan?
A homeowner loan is borrowing money using a property (usually your house or apartment / flat) as security against your loan.
Lenders can often be more flexible about who they give loans to if you use your home as security. As a result, people with adverse, poor or even bad credit histories are often able to borrow the money they need without the need to pay higher rates of interest that are sometimes associated with unsecured loans.
How do I borrow money against my home?
In order to secure a homeowner loan, you must be a homeowner or mortgage holder and there must be enough equity in the property being used as security to cover the loan.
Our loans are also often called homeowner loans, secured loans or second charge mortgages. Using your home as security against your loan can be a great way to get the cash you need, when you need it, and paying a lower rate of interest.
Even though using your home as security could help you borrow more money or overcome a poor credit history, it’s important to remember that your home may be repossessed if you do not repay the loan. Always make certain you can afford the monthly repayments and always budget for them each month.
At Central Trust, we pride ourselves on offering some of the best secured loans in the UK. We provide clear and transparent information, making it easier to compare secured loans and make an informed decision.
All loans come with risks. For example, your credit score may decrease if you fail to repay your monthly payments on time. The biggest risk of a loan secured on houses is that if you are unable to repay your loan, your house is at risk of repossession, so it is important to make sure that you can afford any loan that you commit to.
At Central Trust, we would only ever repossess a house as an absolute last resort, and we always work closely with any of our customers who may be struggling to find better options.
Homeowner loan rates
The exact interest rate of a homeowner loan will vary depending on your personal circumstances.
The total cost and repayment periods of all loans will vary from company to company and will be based on how much you wish to borrow, your credit history and how much equity is in the property being used as security. We will always offer you the best homeowner loan rates that we can, but it is important to remember that the interest rate we will be able to offer you may vary. We will always make sure that you can afford the monthly repayments before we agree your loan. Your home may be repossessed if you fail to repay your loan; however, we will always try to help you to ensure this is the last resort.
As with any loan, it’s important to understand that falling behind on your repayments could potentially impact your credit score, and in some extreme cases, could potentially put your home at risk if your loan is secured against it. We will always try to ensure that your monthly repayments are affordable, however if circumstances change, we are here for you and will work to find a suitable solution.
Here are some of the things that may affect the interest rate of your loan:
How much equity there is in your property
There must be enough equity to cover the value of the loan secured against it
Your income
It is essential that you can afford your repayments
Existing credit agreements
Existing debts will affect the amount you can afford to repay each month
Credit score
This may affect the interest rate of the loan, we may still be able to help if you have bad credit
Are homeowner loans the same as secured loans?
Homeowner loans are frequently referred to as secured loans because you must be a homeowner to use your house as collateral.
Whilst all homeowner loans are secured loans, not all secured loans are homeowner loans. It depends on the asset used as collateral. Almost anything of significant value can be used as collateral to secure a loan. Common assets include residential or commercial real estate, vehicles, cash savings, and investment portfolios.
All secured loans give the lender similar rights to repossess your home if you don't keep up repayments.
How does a secured loan work?
Like nearly all other loans, you will repay interest on top of the amount of money you borrow. You will be required to make regular monthly repayments for a set period of time, usually known as the “repayment period”. If you choose a longer repayment term, your monthly repayments will usually be lower, but you will pay more interest overall. A shorter repayment term will have higher monthly repayments, but you will pay back less interest in total. With Central Trust, you can choose a loan term that best suits your needs.
Just like a mortgage, the interest rates for secured loans can either be fixed or variable. A fixed rate means that you will always repay the same amount of money, and a variable rate means that the amount you repay can go either up or down.
We can provide either fixed or variable secured loan rates, and our repayment periods range from 3 years up to 30 years depending on how much you want to borrow.
What’s the difference between a secured and unsecured loan?
Unsecured loans do not have the risk of you losing an asset like your home, however they can be harder to get so you will most likely need a good credit score. Secured loans mean that you offer something in return (usually your home) if you are unable to repay the loan.
Secured Loans checklist:
Risk
Your home or property may be repossessed if you don’t keep up your repayments
Credit Score
Using your home as security may help you get a loan with bad credit
Loan Size
Loans secured on property may help you borrow more money than unsecured / “personal” loans
Interest Rates
Interest may be lower as lenders have less risk
Unsecured / Personal Loans checklist:
Risk
Defaulting will affect your credit score, but your home won’t be at risk
Credit Score
It is often harder to get an unsecured loan with bad credit
Loan Size
Lenders may offer smaller loans as there is more risk of you being unable to repay larger amounts
Interest Rates
The amount of interest you are charged will rely more on your credit score. The poorer your score, the more interest you may be charged
What can you use your loan for?
Your loans can be used for various purposes such as debt consolidation, home improvements, weddings, and short-term finance purposes.
What should I consider when taking out a secured loan?
Taking a secured loan means putting your home at risk of repossession if you do not repay the loan. This means that you should think carefully before taking one out. There are three main things to think about:
Are you certain that you have enough money available each month to make your repayments? Are there any potential costs that could cause an issue in the future?
Before lending you money, a lender will check how much “equity” is in your property. In simple terms, equity is the difference between how much your house is worth, and how much is left to repay on the mortgage. This means that there must be enough value in your home after the mortgage is repaid, to cover the amount you borrow on a secured loan.
Secured loans usually have a fixed or variable rate. With a fixed rate, the interest rate stays fixed for the duration of the introductory period. However, if your loan has a variable interest rate, there is the chance that your monthly repayments could go up. It is important to consider this when checking the affordability – if your monthly repayments were to increase, could you still afford them?
Is a secured loan right for me?
A secured loan may be suitable if you are a homeowner, need to borrow a larger amount, and understand that the loan is secured against your property. It may not be suitable if you can borrow more cheaply elsewhere, are already struggling with essential bills, or are consolidating debts over a longer term without understanding the total cost.
Before taking out a secured loan, it's also important to be aware of any risks. Loans secured on houses have the same risk as other loans, including negative marks on your credit history if you fail to repay the loan, and additional charges for missed payments. In addition, there is also the risk of losing your home if you cannot afford to repay your debt. This means that it is very important to consider these risks, and make certain that you can afford to repay the loan before you commit to it.
We will help you consider all the options we have available, and will always keep your best interests at heart before making any recommendations to you. All our loans have a 7 day cooling off period after submitting the application, so if you change your mind you are completely free to do so! Also, if you were to ever experience difficulties repaying your loan, we would always do our very best to help you find a solution, and we would only ever repossess a property as a very last resort.
Bad Credit Homeowner Loans
Homeowner loans aren’t just for people with good credit, we can also provide loans for applicants with adverse, poor or even bad credit histories…
If you have struggled with debt in the past, have a bad credit score or have previously been declined by lenders due to your credit history, it doesn’t mean that every lender will turn you down.
Whilst some lenders may not be able to assist people with bad credit, at Central Trust, we consider all credit histories, despite historic issues such as defaults, CCJ’s, missed payments and those on debt management plans.
Unlike other lenders, we look at the bigger picture.
There is no strict automation to our lending decisions. We take a common sense approach based on your specific case. A member of the team, NOT a computer, makes the final decision, every single time. We consider each application for a bad credit homeowner loan on an individual basis, so whatever your credit circumstances, we will try our very best to help you secure the home owners loan you want.
Why choose Central Trust?
Fast and Simple Process
You could access funds within days by calling our team directly or enquiring online.
Over 35 Years’ Experience
We are one of the UK's longest established specialist lenders, so you can relax knowing you're dealing with an experienced team.
Authorised and regulated by the FCA
We are committed to responsible lending, clear communications and good customer outcomes throughout the borrowing journey.
Your Loan,
Tailored for You.
Consolidating debt? Paying for a large expense like home improvement or a wedding? We have you covered.
Unlike many other lenders, there is no strict automation to our lending decisions. Your application is assessed by our team, not by a computer.
How it works
Organising your finances can sometimes feel stressful, but we want to make it as easy as possible for you.
In just 3 simple steps you could have the money in your bank account. All you need to do is:
Enquire
Complete our quick and easy online enquiry form. Alternatively, you can speak to an advisor instantly by calling us or starting a live chat.
Share
One of our qualified advisors will call you to discuss your enquiry and work out a monthly payment that meets your needs and circumstances.
Complete
We'll help you complete the paperwork and any other supporting documentation required. Everything can be completed electronically, or on paper if you prefer.
Ready to enquire?
Call an advisor free on:
0800 980 6273
- Friendly UK based advisors
- Enquiring won't affect your credit rating
- Fast turnaround time 7-10 days is possible
- Immediate contact from our advisors
- We are a direct lender
How does a homeowner loan work?
A homeowner loan uses your home as security against the amount of money you borrow (known as providing ‘collateral’).
Using a property as security usually lets you borrow money at a lower interest rate, and to borrow larger amounts of money. Your property must have enough equity to cover the value of your loan – it is important to remember that the property may be at risk if you do not keep up with any repayments secured against it.
Using your property as security may also help you get a loan, even if you don’t have a great credit rating. If you would like to check your credit rating, you can carry out a free, online credit check here.
Benefits of a homeowner loan
The benefits of using your home as security against a loan include:
- Interest rates for homeowner loans can be lower than unsecured loans.
- You may be able to get a homeowner loan despite a poor or bad credit score.
- You can usually borrow more money than with an unsecured loan.
- You could get a longer repayment period than with an unsecured / personal loan (but remember: the longer you take to pay off the loan, the more interest you pay in total).
Even though using a property as security will often help you get a lower interest rate, it’s important to remember that the exact interest rate of your loan will depend on your personal circumstances.
How much could I borrow?
Typically with homeowner loans you can borrow up to £250,000. However the amount you can borrow depends on the available equity that’s in your property.
Equity is the portion of your home that you own outright free from any mortgage, including your initial deposit and the money you’ve paid back. To work out how much equity you have in your home, simply subtract the amount you owe on your mortgage form the market value of your home.
What questions could I be asked?
Whilst homeowner loans can give borrowers the funds they need, it is important to note that mortgage offers are dependent on various factors. Every lender has different criteria that they use to work out your affordability as well as how much you could borrow.
As part of your homeowner loan application, lenders will complete an affordability check to assess your ability to repay the loan. It’s likely that they will ask you to provide evidence of your income and expenses including essential and non-essential out-goings.
You may even be asked about future plans, as this can sometimes impact your finances and ability to pay your mortgage repayments.
At Central Trust you can borrow up to a maximum of £250,000, with repayment terms from 3 to 30 years. It’s easy to enquire, simply fill out our application form, or call the number at the top of this page to speak to a qualified mortgage advisor.
How much does a homeowner loan cost?
The cost of a homeowner loan depends on several factors, such as:
- The amount of money you borrow – the money you borrow you will have to repay over your mortgage term. As mentioned before, how much you are able to borrow is dependent on the equity in your property and your personal circumstances.
- The length of your loan term – typically for a homeowner loan you can borrow over a period of 3-30 years, however this is dependent on your personal and financial circumstances. It’s important to note that if you borrow over a longer period, the overall cost of credit will increase as you will be paying interest for longer.
- Interest rate – Lenders charge borrowers interest on the money you borrow, so you will repay the amount you’ve borrowed plus the interest. The rate of interest you’ll be charged varies according to the term and size of your loan.
- Loan fees – usually when taking out a homeowner loan, there are arrangement fess that are charged by the lender for setting up and agreeing to the loan. If you were to apply for a homeowner loan via a broker, you may have to pay an additional broker fee.
Who are homeowner loans suitable for?
As you’d expect, you can’t get a homeowner loan without owning a property. If you rent your home you would need to look at applying for an unsecured loan that doesn’t require an asset to secure the money to.
Typically, this type of loan is used by homeowners who want to borrow a larger sum of money. This is because the money you borrow is secured to your property, unlike an unsecured loan.
What are the risks associated with a homeowner loan?
No loan is 100% safe, as failure to repay will result in a poor credit history. Borrowing against your home can be risky, but only if you don't pay back the money. A homeowner loan can be good if you wish to borrow larger amounts, get a better interest rate or overcome a poor credit history, but it essential to make sure that you can afford the repayments as you home may be at risk of repossession if you can’t.
Are homeowner loans a good idea?
If you are sure you can afford the repayments, a homeowner loan can help overcome a poor or bad credit history, and may allow you to get lower interest rate than an unsecured loan and potentially save money. But borrowing against your home can be risky. If you struggle to meet the repayments, you will be risking the property. But repossessing a property is often the very last resort for a lender, they will always try and help reach an agreement with you before things get that far.
Is a homeowner loan the same as a mortgage?
No. A homeowner loan is different to a mortgage. A homeowner loan is taken out in addition to your mortgage, but your mortgage takes priority over a homeowner loan. This means that if your house is repossessed to pay off a debt, the mortgage lender will be paid first. Then the lender who provided the homeowner loan will get what they are owed. If any money is left over, you will get it.
Is a homeowner loan the same as a secured loan?
Homeowner loans are frequently referred to as secured loans because you must be a homeowner to use your house as collateral.
Whilst all homeowner loans are secured loans, not all secured loans are homeowner loans. It depends on the asset used as collateral. Almost anything of significant value can be used as collateral to secure a loan. Common assets include residential or commercial real estate, vehicles, cash savings, and investment portfolios.
All secured loans give the lender similar rights to repossess your home if you don't keep up repayments.
