There are numerous ways to borrow money:

- Secured loan =F1 An advance on your mortgage (see detail below)

- Unsecured personal loan =F1 Tends to cost more in interest and
needs to be paid off quicker than a secured loan.

- Credit card =F1 If you pay off your balance every month in
full, this costs you nothing. However, if you don%rsquo;t, interest
rates can be high and can outweigh the initial amount that you
borrowed on it. You will be charged if you miss a payment and
some charge an annual fee.

- Store card =F1 Similar to a credit card, although the interest
rates can be even higher. Not a problem if you pay the balance
off every month, but it soon adds up if you don%rsquo;t.

- Hire purchase =F1 Used for buying expensive items, such as cars
or kitchens, but tends to have a high rate of interest and a
much shorter repayment term than a secured loan.

- In-store interest free credit deals =F1 Often they are only
interest free for a certain period. If you do not pay off in
full during that time, you could be landed with a hefty
interest bill.

- Current account overdraft – Access to a monthly amount of
money, that you pay interest on. It can involve high rates of
interest, monthly overdraft fees and sometimes set-up costs.

However the advantages of secured loans are many and are well
worth looking in to. A secured loan is a way of borrowing by
releasing equity (money) from your home, to be used for a
variety of reasons.

What can a secured loan be used for?

- To consolidate other debts =F1 makes things more manageable
- To fund a wedding =F1 do it in style
- Pay for a dream holiday =F1 ever feel life%rsquo;s too short!
- Do vital maintenance to your house =F1 prevention is better
than cure
- Buy a new car =F1 live the dream
- Build a new garage =F1 add value to your property
- Create an extension on your home =F1 much cheaper than moving
house

The advantages of a secured loan:

- As the loan is secured against your property, so of less risk
to the lender, the interest rates offered are generally far more
competitive than an unsecured loan (such as an overdraft).
Borrowing on the value of your home is by far the most cost
effective way to borrow a lump sum. Even if you haven%rsquo;t owned
your property for very long, you will probably find that it%rsquo;s
value has probably increased more than sufficiently to make an
advance a worthwhile and money-saving investment in what is
probably your biggest asset.

- A sensible way to borrow money for expensive, one-off type
products or experiences

- If necessary you will be able to reduce your monthly payments
by paying the loan off over a longer term =F1 as long as your
mortgage if you choose. By taking out a secured loan your
monthly repayments will be far more manageable than using a
credit card or unsecured personal loan.

- Unlike other types of borrowing, homeowner loans can allow
you to pay off the amount in line with the length of your
mortgage. This can make repayments far more manageable, as a
loan repaid over 20 years will involve substantially smaller
repayments than one that has to be paid off over five years.

- You tend to be able to borrow larger sums than with unsecured
loans, such as credit cards.

- If you have any outstanding loans that aren%rsquo;t secured on your
property, ideally pay them off. If this isn%rsquo;t possible, add them
to the homeowner loan, for a much more competitive rate =F1 which
will save you money in the long run.

About The Author: Industry veteran Pam Ledger writes for the
website http://www.privilegeloans.com – The site is well-known
for providing the best loan rates available.
http://www.privilegeloans.com/

Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=3D111009