Article reading time 9 minutes
If banks refuse to issue the required amount at a favorable interest rate, there is a reliable alternative to traditional consumer lending - a loan secured by an apartment or house. This is one of the types of secured loans. The bank will receive additional guarantees of return of funds, which means that its risks will be significantly lower and it will be more likely to approve such a loan.
Why take a loan secured by real estate
Unsecured loans are issued for up to 5 years, in some lithuania mobile database cases up to 7. The amount is also limited - on average 1.5-3 million ₽. With collateral, you can get up to 80% of the market value of the property, and the loan term can be up to 20 years.
If you need a large sum, then with a term of 5-7 years, monthly payments may be too large. If the sum of payments on all loans is more than 50% of your monthly income, the bank will not be able to approve the application. In this case, a secured loan helps.
Pros and cons of a loan secured by real estate
Like other large loans, a home equity loan has its advantages and disadvantages. These are listed in the table below.