Low Cost Secured Loan: Making A Mountain Out Of A Molehill!!
Written by: Marsha Claire
The loan market today is filled with an array of diverse loans.
These efforts have expanded horizons and opened up novel
dimensions that we can now take advantage of. Lenders are
altering interest rates, repayment terms and collateral
requisites to create a loan with precision. A rare comprised
package of all!
A Low Cost Secured Loan like any other secured loan requires you
to guarantee repayment and hence demands that the creditor be
given some security. Collateral arises out of this need and can
be in the form of your home or any securable asset. The higher
the value of the collateral, higher is the possibility to lower
the interest on your Low Cost Secured Loan.
A Low Cost Secured Loan is defined differently by different
people. For some people it means low monthly repayments, for
others it could mean lower amounts of interest repayable in
total, getting a higher percentage on the equity in your home
that is offered as collateral or taking advantage of your credit
history (only if good!). However, all these criteria vary for
each individual. Loan terms must be in perfect harmony with the
borrower's requirements and financial standing and not in
accordance with loan standards. A perfect Low Cost Secured Loan
should be inclusive of all means that can cut down the cost of
The main factor influencing the final cost of a loan is the
interest rate. Interest is the amount you pay additionally over
the principal. Repayments are calculated by dividing the secured
loan amount and its additions on its repayment term. When a
borrower draws a low cost secured loan (at a lower interest
rate), he will surely have to pay less as monthly or quarterly
repayment Interest can also fluctuate depending on your credit
history and the collateral you put up against the loan.
A Low Cost Secured Loan stands true to its definition only when
it becomes cheaper than a regular secured loan. Good credit
history can make this difference. A good credit statement gives
the lender a summary of your financial dealings and how you
repaid loans in the past. Here, good credit assures the lender
of your monthly repayments. This also makes it easier for him to
lower your interest rates. On the other hand bad credit reverses
Putting up high-value collateral can further lower the cost of
your Low Cost Secured Loan. A lender isn't going to give you the
total value of your collateral anyway, but if you're offering
collateral that is worth quite a bit more than the amount that
you're requesting, then they're much more likely to give you
lower interest rates. Sometimes with a good financial standing,
you can get even up to 125% of your collateral value, while with
bad credit it can become difficult to get even 65% of it. A high
collateral value in comparison to the requested loan amount all
but guarantees the lender of repayment and he allows you to reap
from this benefit by lowering the interest rate and thus your
monthly payments. Also, collateral that is easily accessible and
of high value can negate any effect that bad credit can have on
your Low Cost Secured Loan.
Using the same lender repeatedly establishes a relationship
between you and him and increases your likelihood of getting a
Low Cost Secured Loan. If a lender has had positive dealings
with you in the past, then he is more likely to trust you again.
Though everyone desires to have a Low Cost Secured Loan, not all
are aware of the manner in which to proceed to get one. The
first thing you must know is that Low Cast Secured Loans are not
available readymade. You need to make an effort researching and
finding loan terms that suit your pocket. After customizing a
loan with your lender, do the calculations and make sure that
the Low Cost Secured Loan works out to be low indeed. Compare it
with other loan quotes. So here you become aware of the loan
statistics without having incurred any obligation.
About the author:
Marsha Claire is offering loan advice for quite some time. To
find Secured loans, secured personal loans, secured debt
consolidation loans, Low Cost Secured Loan.
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