| Remortgages and secured loans are both home loans | | | | their second or subsequent property, although these |
| that are only available to homeowners and mortgages | | | | home movers will not usually have a problem supplying |
| are another very closely related form of loan. | | | | the deposit, as they will even in these difficult financial |
| The main difference between mortgages and the | | | | times have made a profit on their current property that |
| other two financial products is that the latter are only | | | | can be used as a deposit for what will be in general a |
| available to homeowners and a mortgage is a loan | | | | larger or more expensive property. |
| used to buy a house even if the borrower is buying | | | | Remortgages are just the taking out of a mortgage |
| their very first property | | | | with a different mortgage provider to either raise |
| Therefore one does not have to be an existing | | | | additional money or to simply obtain a better rate of |
| homeowner to apply for a mortgage but secured | | | | interest. |
| loans and remortgages are only available to those | | | | Many homeowners choose to take out a remortgage |
| who already have a mortgage on a property. | | | | at the end of their current mortgage deal. |
| It is more difficult for people to get their first foot on | | | | Early repayment penalties have to be paid of between |
| the house ladder now than it used to be in the | | | | 2% to 5% if a mortgage is repaid early. |
| precession days when mortgages of 100% of the | | | | With rates varying so much between one lender and |
| property value were available. | | | | the other, much can be saved with remortgages |
| The Northern Rock even advanced loans at up to | | | | Secured loans are homeowner loans, which like |
| 125% and look what happened to this particular lender. | | | | mortgages and remortgages are secured on the |
| The way that this mortgage plan worked was that a | | | | property, and like remortgages, a secured loan can be |
| mortgage of 100% was advanced and the other 25% | | | | used for a number of different things from buying a |
| was supposedly an unsecured loan, but in reality this | | | | car, paying for holidays and weddings, etc. |
| 25% was secured at the end of te day, as the figure | | | | Remortgages and secured loans also double up as |
| of the two balances was added together and was | | | | debt consolidation loans that save money by uniting all |
| known as the total mortgage borrowings. | | | | high interest loans into the one. |
| During the recession many would be first time buyers | | | | The main difference between secured loans and |
| were compelled to rent a property rather than buy, as | | | | remortgages is that a remortgage replaces the current |
| they could not afford the 25% deposit that was now | | | | mortgage, and a secured loan is a separate loan that |
| required. | | | | stands by itself and does not interfere with the |
| Now there are some lenders advancing loan to values | | | | mortgage in any shape or form |
| at up to 85%. making the situation a little better at least | | | | Therefore although these three home loans have a lot |
| for those buying their first home | | | | in common, they also have very distinct differences. |
| Mortgages are also normally required by those buying | | | | |