Secured Loans Credit Crunch - When Will Things Start to Get Better?

If you have recently been in the market for a secured loan, then you have no doubt realized that the worldwide credit crunch has adversely impacted the secured loans market in the United Kingdom.

To start with, a substantial number of secured loan brokers and lenders in the United Kingdom have closed up shop. Lenders that you may have dealt with before have now perhaps closed up or are "temporarily" closed to re-tool their product offering.

For the companies that are still in business, their lending criteria are decidedly more strict. Gone are the 125% secured loan offers. Secured loan lenders will usually require a higher household income. Secured loan lenders have, en masse, raised the minimum borrowing amount (usually 10,000 pounds in most cases).

This is not just a situation that is unique to the United Kingdom. Countries all over the world have found themselves suffering from the credit contagion that started with the collapse of the subprime mortgage market in the United States. There is less capital sloshing around - the days of "easy money" are over. Now, lenders are extremely picky as to who they will lend money to. They want to minimize their risk as much as possible, which leads them to cherry-pick only the best and least risky customers.

For many people searching for secured loans, they have found themselves on the outside looking in. The only companies that are willing to lend them money are looking to charge an arm and a leg for interest rates. Surely things will start to improve?

The good news is that lenders are starting to soften up a bit, and gently relax their lending criteria. It is a slow process, but the credit crunch has, at the very least, moderated worldwide throughout the past few months. Many prognosticators and pundits are predicting that the worst of the credit crunch is now behind us.

I would expect that over the next 6-12 months, things will markedly improve in the UK secured loans market. This should mean higher LTV loans re-appearing on the market (perhaps we will see the return of the 125% secured loan), and companies continuing to aggressive seek out new clients.

What to do in the mean time?

There are still hundreds of active secured loan companies operating in the United Kingdom. If you can't wait 6-12 months for the secured loan market to improve, then there is nothing to stop you from applying today. Simply click on the link below and fill out our two minute application form. We will search our database of over 250+ UK lenders and try to find a loan that works for you.



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