Greater Central Texas Federal Credit Union,
3305 E Elms Road
Killeen, TX 76542
Telephone: 254-690-2274
www.gctfcu.net

Understanding Secured Loan

28. June 2021 Administrator Blog (0)
A secured loan is a loan that is backed by collateral in the form of financial assets as a means of ensuring that the borrower makes timely repayment. Secured loans are the best option for anyone looking for convenient and affordable loans with simple eligibility requirements and flexibility.

Here are some things to know about secured loans:

  • They Require Collateral: Collateral is usually in the form of any financial asset. Secured loans are secured against collateral which can be used by a lender to regain the loan amount in case it is not repaid.
  • Low Interest Rates: Secured loans are available at lower interest rates as they are pledged against collateral. This makes them a good choice for those on a restricted budget; one can borrow huge amounts as these loans are perceived to be safer in terms of repayment.
  • Flexibility: Secured loans are highly flexible as far as repayment options, loan approval and customization options are concerned. Repayment options can be fixed or variable depending on the requirement of a borrower. The loans can be customized to suit the personal and financial needs of a borrower.
  • Eligibility: Even though every financial institution has a unique set of requirements for a secured loan, some of them are common. For example, in order to avail a secured loan from a credit union, one must be credit union member, possess assets that match the value of the loan or exceed it, produce proof of identity, proof of residence and more.
  • Factors To Consider: When getting a secured loan from a financial institution, consider the type of collateral you are willing to provide, whether the interest rate is fixed or variable, the APR (Annual Percentage Rate) and interest rate, fees charged by the lender, minimum and maximum amount of loan, income requirements and more.
  • Preparing For The Loan: Before getting a secured loan, check your credit, get your assets evaluated to know how much you can borrow and suitable monthly repayments. Some financial institutions like credit unions offer online facilities that enable members to apply for a secured loan online.
  • Defaulting: In case one misses the payments for a secured loan, the financial institution that granted it has the right to repossess the asset that was used as collateral. Every state has different laws regarding this procedure i.e. some require a notice of repossession while other waiver it. If the repossessed asset is not sufficient to compensate for the amount of loan, the borrower will have to cover the difference.
Contact Greater Central Texas Federal Credit Union to buy secured loan in Killeen, TX. For more details on secured loans, visit 3305 E. Elms Rd., Killeen, TX - 76542. You can also call at (254) 690 – 2274.
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GCTFCU Blog | Reasons To Borrow Secured Loan
Greater Central Texas Federal Credit Union,
3305 E Elms Road
Killeen, TX 76542
Telephone: 254-690-2274
www.gctfcu.net

Reasons To Borrow Secured Loan

17. May 2019 Administrator Blog (0)
Secured loans, also referred to as collateral loans are backed by an asset (usually a home or car) that is pledged as security to the lender. You can also get a secured loan against your savings account, a certificate of deposit or anything of value. In case the borrower is unable to return the loan, the lender has the right to take possession of the collateral and sell it to compensate for the unpaid amount. Lenders often seek collateral that is of a greater value than the amount of loan.

Common types of secured loans are mortgages, secured credit cards, secured personal loans and home equity loans. Secured loans offer numerous benefits to the borrower, some of which are listed below:

  • Enhances Credit Rating: Secured loans are easy to acquire even if the borrower’s credit rating is low. However, a borrower can work towards building his credit score over time by making timely payments towards his secured loan.
  • Lower Interest Rates: Another major reason for borrowing secured loans is their rate of interest. Since the loans are secured with a collateral, lenders feel more confident and may disperse loans at lower interest rates.  
  • Flexible Terms: Borrowers who avail secured loans enjoy flexible repayment terms. A consumer can choose a repayment schedule that suits his financial circumstances. The repayment terms may be as long as 30 years. Lenders offer longer terms because real estate pledged as security, usually appreciates over time and this adds to the value of collateral while the loan is being repaid.
  • Usage: Secured loans can be used for a variety of purposes provided the purpose is legally valid. A consumer can use the money for investing, home improvement, weddings, funeral expenses, moving expenses, etc.
  • Larger Loans: With secured loans, borrowers enjoy the benefit of being able to borrow larger amount of money for a longer duration. This is because of collateral in the form of tangible assets guaranteed to the lender by the borrower. Lenders know that if for any reason the borrower defaults to pay back the loan amount, collateral can be sold to recover the unpaid amount of loan.
  • Easy To Acquire: The main requirement for a secured loan is collateral. Thus, if you have collateral in the form of a valuable asset such as a piece of real estate, a car, precious jewelry, a house or deposited cash, you can easily acquire a secured loan.
Greater Central Texas Federal Credit Union offers affordable secured loans to its members in Killeen. The loan officers at the credit union help the members in choosing loan amount and terms as per their financial situation. To know more about secured loans in Killeen, call at (254) 690 – 2274 or visit 3305 E. Elms Rd., Killeen, TX - 76542.

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