Secured Loan Market On The Rise

Fri, 19 Oct 2007

UK personal secured loan market is set to surge from 7.5 billion worth of loans advanced in 2006 to £10.2 billion by 2011, a new financial report predicts.

A new report from analysts Datamonitor estimates that the growth in demand for loans secured against a borrower's property will reach five per cent a year over the next four year-peroid.

The increase in demand for secured loans is due to the growth in demand for debt consolidation products along with a rise in levels of unsecured debts .

Growth is expected despite some lenders pulling out of the market in the fall-out of the US sub-prime crisis and the following credit crunch, which has made it more difficult for lenders to access finance on the money markets.

Maya Imberg, analyst with Datamonitor's Financial Services practice, said: "The US sub-prime mortgage crisis and global credit crunch will affect the market in the short term."

"However the UK secured personal loans market continues to portray an encouraging future in the long term."

But, with UK lenders less likely to take on risks and tightening lending criteria, consumers will feel the pinch – making it harder for them to secure a deal .
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