Loans from stretched senior debt lenders can be a great way to reduce your current monthly budget. They are different from personal loans, as they are secured against your home. While the rates of interest are typically higher, you have lower risks of repossession. There are several benefits of choosing this type of loan, including:
The primary benefit of stretched senior debt finance is the low monthly repayments. Repayments are generally up to 40% less than the combined amount of your other monthly bills. This is due to the use of a mezzanine loan, where the interest rates are charged on a separate loan, rather than on the housing. Repayment terms are usually quite flexible, which means that the borrower can choose a term that best meets their needs.
Lenders usually protect the investment with collateral
They may also include a co-signer (someone who signs for the deed) in case you cannot make regular payments. Many lenders will also include some of your property in the loan, so you don’t have to fork out money for this upfront. In addition, many of these lenders will accept your property as collateral for unsecured financing, which can save you thousands of dollars. They usually require a high GV rating, but some will consider even A+ credit if they feel it shows a commitment to quality service.
If you have experienced a recent financial hardship or have an imperfect credit history, there are traditional lenders available to assist you in your senior debt consolidation venture. There are also private investors who are willing to finance residential developments (which will also require good credit). Private investors rarely approve loans to borrowers unless there is a solid business plan and plans for the use of the funds. However, if they do fund your projects, they will often require that borrowers commit to specific milestones or other requirements in order to ensure they honor those agreements.
Lenders also offer a choice of stretched senior refinance loans
These loans are designed to keep homeowners in their homes and provide additional flexibility to the borrowers. These lenders require a low credit score, but they will also review your current loan and will consider whether you have made any payments late. Because they do not require a purchase contract, borrowers who are interested in this type of loan will likely need to have other sources of funding (a refinance loan may not be possible).
These lenders will likely require that borrowers agree to finance in writing a balloon payment that will cover the remainder of the balance and is intended to help borrowers avoid foreclosure.
The last category is debt consolidation
When you consolidate your debts into one lower interest rate loan, your overall debt payment can be lowered. Your interest rate will be lowered to a variable rate and you can also eliminate or reduce your multiple monthly payments. However, when you consolidate, you should also consider the fact that the debt facility will probably require a co-signer. This means that the new loan will be subordinate to any other existing debts that you may have.
If you need more information about how you can borrow money from the UK’s high street banks, you can find out more by visiting the Citizens Advice Bureau. This government-run organization can give you impartial advice about how to arrange finance with the different lenders and also with debt agencies. You will find that most lenders will be willing to work with you, but it may take some time to arrange an agreement. Once you have borrowed the money from the bank or other financial institution, you will be required to pay it back.