Lenders Tighten their Belts

The recent upheaval in the credit markets means for the first time in a generation or more, credit is becoming harder to obtain despite the Bank of England and the Federal Reserve in the US injecting billions of pounds into the market. Interest rates have also been cut by both the UK and the US and will continue to fall according to pundits in the industry. The whole situation is particularly bad news for those seeking loans with no assets to secure against as many lenders are refusing to lend on some such terms. Some pundits also predict that the situation will become worse before it gets better, however long this takes.

Those lenders who are suffering big losses in the US sub prime market are also starting to recoup losses by not passing on interest rates cuts in addition to slashing savings rates. In these difficult times, the good news is that if you are shopping around for a secured loan and have sufficient equity in your property or asset, you are more like to get a favourable outcome should you apply for a homeowner loan. However, because the credit markets are being squeezed, it is worth doing your homework before hand to find out which lenders are receptive to your needs and are likely to make a loan offer. Don't forget each application for credit makes a mark on your credit history record which some lenders take into account when assessing secured loan applications. Always consider seeking independent financial advice and ensure such a course of action is beneficial for you.