Tuesday 19th of May 2009
Borrowers hoping to consolidate their debts by taking out secured loans are seeing their options decline, it has been found.
With 14 lenders having withdrawn from the second charge secured loan market since mid-2007, Moneyfacts.co.uk revealed that just three providers remain.
Analyst at the site Michelle Slade explained that such loans are often considered by people who wish to reduce their outgoings, but falling house values have meant many do not have enough equity to take advantage.
"Secured loans offer consumers the option to consolidate their debts over longer terms of up to 25 years, whereas unsecured loans only offer up to a maximum term of ten years," she said.
Those who are finding it difficult to consolidate their debts may wish to consider non-borrowing solutions such as individual voluntary arrangements in order to reduce the amount they have to repay.
The Royal Institution of Chartered Surveyors recently suggested that the Bank of England’s decision to inject more money into the financial system could stimulate lending.
- House price rise 'may not indicate recovery'
- Equity release 'needs to be increased'
- Need for IVA help could increase as expert predicts reduction in lending
- Government announces 'breathing space' for those needing IVA help
- Lack of subprime lending creating need for IVA help, expert suggests
- IVAs could help kerb reckless spending
