Loans Blog

A secured loan is usually secured against the value of your home. So, one of the best ways to get together some cash for home improvements is to take out a secured loan against the home you are planning to improve.

By improving the home, you should be adding value to it - the lender will be reassured by this fact so there is usually little to stand in the way of being granted a home improvement loan.

Some people think that declaring themselves bankrupt is a great fall-back plan whilst they carelessly continue running up unmanageable levels of debt.

There's nothing great about it, so don't be fooled. You stand to lose EVERYTHING other than what you are wearing, and some of that too.

It's far less traumatic to face up to your situation as early as possible and seek help from a personal loan adviser. They will often arrange a debt consolidation loan, which can be a real lifeline to help you overcome your seemingly impossible situation.

Don't fool yourself - get help and sort it out before you risk losing everything you own.

I saw some really nice shoes I wanted to buy today. Only thing was, I couldn't afford to buy them until I'd sold the ones I bought last week. I was confident Sandra would buy them, but I hadn't actually made the sale.

Luckily, I managed to arrange a sort of bridging loan with Trisha - she was kind enough to lend me the money to buy the new shoes until I could sell the old shoes and pay her back. Fantastic, I thought.

A debt consolidation company is reportedly behind the creation of a new boy band, called "ConSolid8".

ConSolid8 consists of 8 members, aged between 17 and 23, who have been hand-picked for the group in a 'Pop Idol' style auditioning process.

A spokesperson for the consolidation loan company, who is not prepared to be named at this stage, said: "The idea is to reach out to young people, who are becoming increasingly in need of debt help. We want to make them aware of the options out there, as it is no longer the case that most people are in their thirties before they get into financial problems and need to seek debt consolidation".

The band is due to be unveiled some time later this year.

People often ask me, "Just what is a bridging loan, then?"

No, really they do. In fairness, it's usually when I'm wearing my T-shirt that says on it "Ask me what a bridging loan is", so you'll see it's not actually that unusual.

I always respond by saying:

"A bridging loan, often referred to as 'bridging finance', is simply a no-nonsense loan taken out to bridge the financial gap between the sale of an existing property and the purchase of new one."

People go home more knowledgeable than they were that morning, and I go home feeling happy because my choice of T-shirt afforded me another chance to give a little bit back to the world. Everyone's a winner.

I was amused to come across a classic typo in the heading of an article today, which preached the benefits of 'dept consolidation'.

The contents of the article made it clear that the subject matter was intended to read 'debt consolidation', but it got me thinking - there are probably businesses out there who are facing the choice of one or the other.

'Dept consolidation' would surely involve having to consolidate your department - ie your staff - into one smaller, affordable team to reduce your outgoings (sacking people!). Whereas 'debt consolidation' could provide an alternative solution to a financial problem - arranging a consolidation loan to reduce the outgoings, allowing the wage bill to remain sustainable (not sacking people!)

Thus, the conclusion of my findings is that Debt Consolidation is better than Dept Consolidation.

A recent report, rather predictably, has concluded that an increasing number of people are turning to debt consolidation in an effort to control their spiraling debt problems.

More than 6.5 million people have taken a consolidation loan in the past three years alone.

Let's hope this statistic reflects the growth in responsible attitudes to debt rather than a growth in the misconception that debt consolidation is just another way to spend other people's money when the credit cards have dried up.

When Carlsberg bought Scottish & Newcastle in a joint deal with Heineken, they did so using a bridging loan to finance the £7.8bn deal.

They have now announced a £3.2bn rights issue to repay the bridging loan.

I'm just going to admit it. I've always been a bit of a Carol Vorderman fan, even though that's probably far from cool these days. But she does make it increasingly hard to defend her right to admiration while she continues to blaze a dusty trail of somewhat unscrupulous personal loan advertisements.

The latest advert in which she appears has been labeled a 'debt trap', encouraging vulnerable homeowners into unmanageable levels of debt.

The secured loan advert, for a company called 'First Plus', offers an attractive low interest rate of 4.9% for the initial 90 day period of the loan, after which the rate increases to a staggering 8.5%.

The lesson, as always, is to look out for such tricks and be fully aware of the complete terms of the loan before entering into any agreement.

Gullible teens, who's skin tissue has now morphed with their chairs through Facebook addiction - leaving them with only 'virtual' friends, are being targeted by unscrupulous loan companies plaguing the antisocial networking site with dodgy personal loan ads.

Debt charity, Credit Action, claim that regular loan ads are targeting those with bad credit ratings through the geeky world of Facebook.

They urge these vulnerable individuals, who have lost the basic skills of real human interaction, to report any instances to the Facebook web site.

I read a piece this morning about using your jewellery as collateral against a secured loan to finance a new car purchase.

All perfectly legitimate, of course, but it got me thinking - imagine what car Jimmy Saville could buy if he took out a personal loan secured against all of his jewellery!

Rumour has it (yes, I've been talking to my source down the pub again) that legendary rocksmiths 'The Cure' got their name from a personal loan advisor with a lisp.

Robert Smith and his musical pals were pacing around the lounge desperately trying to think of a name for their band at his Sussex home one afternoon in 1976, when the lispy loans expert knocked on the door. Smith answered the door and the salesman asked,

"May I offer you thumb perthonal loan advithe, thir?"

Mr Smith replied: "What kind of loans are you offering, sir?"

"Thecure loanth, thir."

"Genius! The Cure! That's it!" Smith proclaimed as he shut the door.

The secured loan salesman went away a little confused and deflated that day. If only he knew what a vital part he'd played in the history of this great band.

Not many people know the true nature of the wise advice James Brown was trying to instill into property buyers when he famously remarked "Take it to the bridge."

His typical 110% enthusiasm and energy, caused him to run out of breath before completing the sentence, which should have concluded "Take it to the bridging loan."

This is, of course, 'soul speak' - meaning "Take out a bridging loan to finance your next property move."

What a genius.

Please note - these facts may not actually be facts, but a very knowledgeable bloke in the pub told me them and I have no reason to doubt him.

A logbook loan is just one of the many types of secured loan available on the market.

The most common type of secured loan is secured against a property, as this is usually the best valuable asset most borrowers have to offer as collateral to secure the risk posed to the lender.

However, a secured loan can be secured against anything that meets the value of the loan. A logbook loan, as the name suggests, is secured against the value of your vehicle. It's called a logbook loan because you hand over your logbook to the lender as security for the duration of the loan term.

In the current wobbly financial climate, the secured loan is continuing to take centre stage as lenders pack their carefree, risk-taking attitudes into a box in the bottom of a wardrobe in the spare room - hoping they'll make use of them in the future; knowing they probably won't; but unable to part with the idea just yet.

Results of recent research conducted by Alliance & Leicester show that “overall borrowing trends are moving away from unsecured debt, while secured lending continues it’s rapid pace.”

I remember my grandparents telling me how they were taught really useful home economics skills in school. My experience of this lesson was learning how to make a bland lasagne and care for your tupperware. But they actually learned economics - how to manage the family budget and make your money stretch further etc.

Now, it seems, these skills are dying away with that generation as more and more teenagers and young professionals fail to take seriously the long-term implications of spending money they don't have and embarking on a lifetime of debt through personal loan financing. They appear completely ignorant to even the individual consequences of their borrowing habits, let alone those facing the economy as a whole.

According to the Mortgage Introducer web site, “over half of Britain’s young people are in debt by the time they reach the age of 17 and think overdrafts and credit cards are an easy way to spend more than they can afford, setting a pattern for the rest of their life.”

Is it time for a serious look at the curriculum? Somehow, I don't think raising an army of clueless teens with average lasagne skills is going to eradicate the problem.

It seems that the penny - albeit a borrowed one - still hasn't dropped for some people regarding the purpose of a debt consolidation loan. These kind of loans exist to help you find a way out of debt - they are not intended to be another avenue for running it up.

As the Chief Executive of MoneyExpert.com, Sean Gardner, says: "it is crucial that borrowers see consolidation as a wake-up call to get debts under control. It shouldn’t be something you keep on doing simply to tide you over from year to year.”

Nemo Personal Finance, the secured loan subsidiary of Principality, announced last week that it is to axe 70 jobs at their Cardiff HQ.

The move comes as a necessary reaction to the credit crunch. Senior bosses at Principality say they will re-deploy staff in other areads of the business.

In recent years, the UK has experienced a huge increase in the number of people applying for a secured loan. This is set to grow further still, amid the credit crunch which is seeing banks tighten their purse strings as lenders offering unsecured loans become increasingly difficult to find.

Bridging finance is not just the reserve of private home buyers who know how to stop their dreams slipping away, a bridging loan is also commonly sought after to finance commercial property purchases.

This allows you to close quickly on a commercial property deal, and then pay back the loan after the sale of a property - refinancing with a more standard kind of loan.