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Secured Loan FAQ

What is an example of a secured loan?

Secured Loans > Our Loans > Homeowner Loans > What is an example of a secured loan?

What is an example of a secured loan?

The most common examples of secured loans are mortgages or car financing. Essentially, secured loans can be used for any large-scale purchase with an asset acting as security on the loan.

Most secured loan examples will be a property mortgage. However, another form of secured lending is any large purchase acting as security on the loan.

For example, you could be buying a car, and it would act as security, making the finance a secured loan. The same goes for bikes, or anything with a high value.

  • An asset, such as a car, will act as security against the loan, particularly if the loan is to purchase that asset.
  • Failure to repay a secured loan may result in you losing that asset, as the lender uses it as security
  • Secured lending may be used for loans of large sums – but you can borrow less
  • Secured loans do not have to be secured against what you are purchasing. The security can be any object of high value, such as jewellery

Secured loans can extend beyond property and mortgages to other objects or financing.

Other examples of secured lending would include business loans, where office equipment or even machinery could act as security on the loan.

Debt consolidation loans, where you put multiple debts into one account, can be a use of secured lending. You would have an asset of value acting as security on the loan.

Warning: Late payment can cause you serious money problems. For help, go to moneyhelper.org.uk
Representative 28.96% APRC (Variable) - For a typical loan of £20,950 over 85 months with a variable interest rate of 23.00% per annum, your monthly repayments would be £537.44. Including a Product Fee of £2,095.00 (10% of the loan amount) and a Lending Fee of £714.00, the total amount repayable is £45,682.15. Annual Interest Rates ranging from 11.7% to 46.5% (variable). Maximum 50.00% APRC. The loan must be paid back by your 70th birthday. Read more.

Think carefully before securing debts against your home your home may be repossessed if you do not keep up repayments on your mortgage or any other loan secured against it. If you are thinking of consolidating existing borrowing, you should be aware that you may be extending the terms of the debt and increasing the total amount you repay.
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