Secured personal loans differ from unsecured loans in that the loan is guaranteed usually against a property. So, if you are unable to repay the loan then the lender can recover the money from a sale of the property. This obviously makes secured loans that much more of a risk than unsecured loans. However provided you understand the nature of a secured loan they can be the ideal solution to a financing problem.
The reasons for getting a secured loan are many and varied, although one popular reason is for home improvements. If there is a project that is expensive, but adds value to a house, it is common to finance the new work by securing a loan against the existing value of the property. This can be done either by a separate secured loan, an increase on an existing mortgage or by re-mortgaging with a new lender. Whatever the method, once the work is completed, the overall percentage of the loan against the value of the property will decrease. However, if the extra money is spread over the term of the existing mortgage, then you should be aware of the total repayments.
Like all forms of finance, a secured loan will have terms and conditions that apply. You should make sure you are familiar with these and in particular look for the penalty clauses like early repayment penalties.
It is possible to compare secured loans using the many comparison engines on the Internet. These sites will list the secured loans and usually order them by their typical APR, which is the best instrument for comparing secured loans. One thing to be aware of though is that it is quite common for the comparison engines to only list those products that produce income for them. Therefore, check out a few different sites and collate the results of each to get the best feel for the right loan for you.
Secured loans often have rates similar to mortgages, so they can be slightly cheaper than unsecured loans. Of course the fact that they are secured means that there are less risk for the lender and potentially your property is at risk if you are unable to repay the loan amount. Therefore make sure you are fully aware of the terms and conditions and understand the product that you are applying for.