Guaranteed Home Equity Loans – Complete Review & FAQs
Representative example: If you borrow £34,000 over 15 years at a rate of 8.26% variable, you will pay 180 instalments of £370.70 per month and a total amount payable of £66,726.00. This includes the net loan, interest of £28,531.00, a broker fee of £3,400 and a lender fee of £795. The overall cost for comparison is 10.8% APRC variable. Typical 10.8% APRC variable
Representative example: If you borrow £34,000 over 15 years at a rate of 8.26% variable, you will pay 180 instalments of £370.70 per month and a total amount payable of £66,726.00. This includes the net loan, interest of £28,531.00, a broker fee of £3,400 and a lender fee of £795. The overall cost for comparison is 10.8% APRC variable. Typical 10.8% APRC variable
Are you wondering if home equity loans are guaranteed? You’ve come to the right place for answers. Every month, this website is visited by more than 6,900 people seeking advice on similar matters.
In this article, we’ll address the following questions:
- Are home equity loans guaranteed?
- What is the current interest rate on a home equity loan?
- How much will a bank lend on a home equity loan?
- Tips for guaranteed approval of a home equity loan.
- What is a good credit score for a home equity loan?
- How to get a home equity loan with bad credit.
I know that understanding home equity loans can be a bit tricky, but don’t worry; we’re here to offer simple advice to help you make an informed decision.
Let’s dive in!
Are home equity loans guaranteed?
Just having sufficient home equity will not guarantee you a home equity loan. As part of responsible lending, lenders still need to assess your individual finances to work out what sort of loan you qualify for. And in some cases, they may decide that you are too much of a lending risk and will reject your home equity loan application.
Some of the things they will need to assess include:
- Existing debts
- Income
- Debt to income ratio
- Amount of home equity you have
- Credit score
For these reasons, guaranteed home equity loans do not exist!
» TAKE ACTION NOW: Compare deals from the UK’s leading lenders
What is the current interest rate on a home equity loan?
Interest rates on a home equity loan and home equity line of credit are rarely published on lender websites. Instead, they will discuss the rate you might be offered in personal consultations and applications. The latest research suggests home equity loan interest rates average between 2% and 10%, subject to change.
Lender |
APRC |
Monthly payment |
Total amount repayable |
|---|---|---|---|
| United Trust Bank Ltd | 5.99% |
£218.73 |
£26,247.92 |
| Pepper Money | 6.86% |
£220.24 |
£26,429.17 |
| Together | 6.95% |
£220.40 |
£26,447.92 |
| Selina | 7.5% |
£221.35 |
£26,562.50 |
| Equifinance | 7.7% |
£221.70 |
£26,604.17 |
| Spring | 10.5% |
£226.56 |
£27,187.50 |
| Loan Logics | 11.2% |
£227.78 |
£27,333.33 |
| Evolution | 11.28% |
£227.92 |
£27,350.00 |
Representative example: If you borrow £34,000 over 15 years at a rate of 8.26% variable, you will pay 180 instalments of £370.70 per month and a total amount payable of £66,726.00. This includes the net loan, interest of £28,531.00, a broker fee of £3,400 and a lender fee of £795. The overall cost for comparison is 10.8% APRC variable. Typical 10.8% APRC variable.
Search powered by our partners at LoansWarehouse.
How much will a bank lend on a home equity loan?
How much a bank is willing to lend as part of a home equity loan will be determined by individual circumstances, including existing debts, income and your credit score.
However, they will not let you get a loan secured against all of the home equity you have because your property value could decrease, which would be bad for all parties. The maximum they will lend is usually around 80% of your home equity.
There might be a minimum home equity loan amount around £10,000 – but not always.
Home equity loan guaranteed approval tips
Although guaranteed home equity loans might not be real, there are some things to improve your chances. They are:
- Don’t apply for more loans than you need. Just because you have home equity doesn’t mean you need to secure more of it against a loan. Borrow sensibly!
- Check your credit score for mistakes and get them removed
- Improve your credit score before applying. There are many ways to do this, such as paying off debts. The score might not increase straight away.
Home equity loans for all purposes
- Stuck paying high interest on credit card debts & loans?
- Looking to fund a home improvement project?
- Dreaming of finally taking the once-in-a-lifetime trip?
Polly
“This was by far possibly one of the nicest experiences I’ve had getting a secured loan.”
Reviews shown are for Loans Warehouse. Search powered by Loans Warehouse.
What is a good credit score for a home equity loan?
Your credit score tells potential creditors how you have handled your finances in the past, and most importantly, how you have repaid any debts. Applying for a home equity loan is no different to applying for other credit and lenders will check your score extensively for red flags.
There is no fixed benchmark of what credit score is good enough to be approved for a loan. Each lender has the freedom to apply their own assessment of personal finances and your credit history. What might not be high enough for one lender may pass with another – or pass based on accompanying factors, such as a high income.
You will typically need a “good” or “excellent” credit score rating to get a home equity loan with a competitive interest rate.
How to get a home equity loan with bad credit
There is no magic recipe to get a home equity loan with a poor credit rating. You should do what you can to improve your score before applying, which may take some time. Seeking equity loan providers specifically advertising for people with poor credit is also an option. But again, you are likely to be subject to a higher interest rate.
