Borrowers looking to borrow a larger amount of money than what is typically available from an unsecured loan may consider applying for a secured loan as an alternative. While borrowers may use a secured loan for similar reasons to if they took out an unsecured loan, their circumstances may dictate they need to borrow more. What is the process to getting a secured loan?
The first step is for the borrowers to shop around themselves, or use a loan broker, to help identify the lender with the most competitive interest rate, lowest overall loan cost, comparison rates, fees and charges; and any additional services a borrower may be able to benefit from. While shopping around, borrowers should also check each prospective lender’s eligibility criteria to ensure they will be able to apply without problems. Once a preferred lender has been identified, the borrower should follow the relevant loan application process and provide any supporting documentation requested by the lender. It is particularly important when considering a secured loan that the borrower can easily prove ownership of the asset the loan will be secured against. Borrowers should also note the application process is longer than for an unsecured loan.
Borrowers should also consider checking their credit report prior to applying for a secured loan.
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