Will The End Of The Recession See The Revival Of Homeowner Loans Otherwise Secured loans?
Homeowner loans are obviously loans that are only available to homeowners, that is those who have actually bought there homes even if they have bought it by taking out a mortgage.
Homeowner loans are sometimes also called secured loans, and the reason for these two names is that only homeowners can apply and also that these homeowner loans are secured.
In the case of a personal secured loan the asset is the equity available in the actual property.
Equity is the diffence between any mortgage out standing on the home and the actual bricks and mortar value of the home.
If a property had a value of 260,000 and a mortgage balance of 160,000 the equity would become 100,000 which does not mean that there is a secured homeowner loan available of 100,000.
At the start of the recession secured loan lenders tightened up their homeowner loan criteria to advance secured loans up to a maximum LTV of 80% for those who are employed and 10% less for the self employed, and although the recession is over the underwriting for the present remains the same.
A new homeowner loan provider is coming into the market and reportedly granting loans on a secured homeowner basis at up to 90% loan to value.
The last two years have been difficult ones for secured loan brokers whose business is more than 80% down on pre recession figures, and homeowner loan lenders have mainly closed their doors entirely.
It is all a big change from the hey day when thousands of homeowner loan brokers arranged thousands of these once so very popular secured loans each year.
Before the credit crunch it was possible for self employed applicants to simply state their net profit on a letter head. and with Future even the employed could declare their own earnings without any back up proof.
The secured homeowner loan sector is a poor shadow of the homeowner loan of 2006 when the sector was vibrant unlike now,and it has been sad to see the fall of so many secured loan lenders and brokers.
Three years ago there was even a homeowner loan in which the homeowner loan could borrow up to 25% more than the house was worth
Learn more about homeowner loans. Stop by Champion Finance’s site where you can find out all about the best homeowner loans for you.