|
Most, but not necessarily all, debt consolidation loans are secured loans. If you have a good credit history, the lender may agree to an unsecured loan, in which case it does not matter that you are not a homeowner. But the interest rates on unsecured loans are generally higher than for an equivalent secured loan where the risk to the lender is less.
If you have an impaired credit history then the lender will only consider lending to you if you are a homeowner with equity in your home. This means that the value of your home must comfortably exceed the value of your mortgage plus any other loans secured against it. The lender will then want to secure your debt consolidation loan against your home. This basically amounts to taking out a 2nd mortgage.
Loans articles
More Loans FAQ's
|
