A secured loan requires you to provide your lender with some kind of collateral as security against your loan. Generally this is secured against property. However, things are changing and we wanted to start by referencing this article on the advantages and disadvantages of secured/unsecured loans to dispel some myths about secured loans:
To begin, you will see the article agrees with the general perception that secured loans are based on property with the frightening possibility of losing your home if you fail on payments. It also says that companies will generally only lend £50,000 and in rare cases can push that to £100,000. Finally, it suggests poor a credit score will make it difficult to get any type of loan. Borro are the exception to the rule.
Borro do offer secured loans, but not against property. Therefore there can be no possibility of losing your home should you miss a payment. We also offer loan amounts up to £1million, increasing by 10-fold what you can expect to get from other secured loan companies. Finally, because our loans depend solely on the value of a particular asset, credit score is never taken into account and consequently, any failure to pay with us will never affect your credit rating.
We see no reason why secured loans can't be measured against alternative collateral to housing, so long as it is something tangible - like a car, jewellery or luxury watch. And this is exactly what Borro offer. In addition, while most of the secured loans you will see on the market are for fixed periods of 1-7 years, we pride ourselves on offering short-term loans for periods as brief as 6-months.
Our interest rates are competitive and, by providing the opportunity to extract value from a valuable without the need to sell, make our secured loans the best lending option on the market today.
To find out more about turning your assets into short-term loans, see our Luxury Asset Loans page or contact an expert on 0808 163 3828 .
We like to keep as up-to-date as possible with the best rates and loan providers in all the information we provide. What might be the best rate today, could well be superseded by a better offer tomorrow. The same goes for providers of loans. Therefore, the advice we would give is to check online for the best rates and providers. There are a number of comparison sites with their share of advertising clichés, furry animals and opera singers and they can all be relied on for pretty straightforward impartial figures. As for getting the bank loan itself, you can either apply online, or in person at a bank of your choosing.
However, as was explained in the previous answer to ‘What is a Secured Loan?' droplink, you should bear in mind that the majority of loan providers only offer secured loans against property. This has even led to well-respected industry experts, such as Martin Lewis to advise here is that secured loans should be seen as a last resort because of the risk of losing one's home should be too great to even consider. He also confirms the points raised in the previous answer - that traditional secured loans only offer up to between £50,000-£100,000 at the very most and that ‘failure to repay has an immediate negative impact on your credit score'.
However at Borro we do not offer secured loans against homes or property of any type instead offering a fresh, new alternative to the secured loans of old, allowing you to secure funds against a range of more suitable assets such as watches, jewellery and gold. In addition, we would like to reiterate that we are able to pay up to £2,000,000 against the value of an item. Finally, our rates are calculated against assets, not people. As such credit score is of no importance to us and therefore, to contradict Martin Lewis, any potential payment failures will have absolutely no impact on your credit score.
It is for this reason we believe our secured loans are far more safe and ‘secure' than other loan types offered on the market today. To find out more, contact us today.
Secured bank loans used to be one of the best ways to get hold of large amounts of cash. However, Borro now offers a new type of secured loan which depends entirely on the value of your item. Other loan types, such as bridging loans and even unsecured loans are worth considering and these have all been listed below:
Unsecured loans are based purely on your financial history and credit status. So long as these figures are positive, you should find that you can get pretty good rates of APR. However, the worse your credit score, the more you will need to pay per month and the longer you will have to make the payments for: to be considered with caution.
Secured loans let you extract the value of an asset without the need to sell. Logbook loans take this one step further where, as well as keeping your vehicle, you can also keep using it - all in exchange for logbook documentation! The advantage is that no one need know you have had to take out a loan. In addition you retain use of your prized asset. However, you do pay a premium for this - up to and over 300% APR. If you can possibly bear to part with your vehicle for 6 months, you would find that rate reduced to 60-80%, giving you time to sort out your finances without the worry and stress of upkeep/maintenance. Find out more about using your car to secure a loan on our Loan Against Cars page.
Bridging & consignment loans
In some ways, bridging and consignment loans couldn't be more different. Put simply, consignment loans allow you to borrow while you wait for an item to go to auction, whereas bridging loans allow you to ‘bridge the gap' between buying a new property before selling the old. However, we have grouped them together as they both allow you access to cash that you expect at some point in the future, but don't have readily available. For further information on the advantages and disadvantages of bridging loans, see our dedicated page here. As far as consignment loans go, Borro actually offer this service at up to 70% reserve value of any asset (some 30% better than rivals Sotheby's) - find out more in our Consignment Loans section.
Borro secured loans
We have already touched on this in the first two questions in this FAQ section. However, in a nutshell, Borro differ to the standard secured bank loans in the following way:
- loan against any assets other than property & electronics
- loans released within 24 hours of application
- no need for credit check
- no matter what, consequences of late/non-payment will not affect credit score
- specialise in short-term loan periods
- can loan up to £2,000,000
If you do decide to go for a secured loan, our Value of Assets page gives an in-depth guide to assessing the value of your assets. Call us today 0808 163 3828 to find out more.