Why is loan “secured”? In a secured loan UK , a property deposit is required as a form of security for lender. This deposit is known as “collateral”, and can come in several forms. It might be a house or lot that you own, or perhaps an automobile… it could even be gold jewelry or antiques that you collect. Regardless of form of collateral, it all serves same purpose: it ensures that lender isn't going to lose money if you don't repay your loan, because they'll be able to sell property that you put up as collateral for your secured loan UK .

Credit where it's due If you have bad credit, then you've done something to get it that way. Either your payments on previous credit lines were often late, or you simply didn't make some of payments at all. Either of these factors will lower your credit score (which is a number that lenders use to determine whether or not you're a credit risk), and once lowered it can take years of on-time payments to restore you to good credit.

Of course, if you're going to make payments then you're going to need a credit line on which to make those payments. Credit cards, loans, and even some bank accounts are considered to be credit lines, and if you get one with bad credit then you might be looking at higher interest rates or sharper fees for late payments and overdrafts.