Many borrowers choose secured loans because they are readily accessible to property owners. The property is usually owner-occupied, but some lenders will underwrite secured loans to landlords of property with tenant occupants. Ex-council properties are also usually eligible for securing loans. Additionally, secured loans are usually easier to get for those people who are self-employed or have a poor credit record.

• Factors that make you a Bad Credit Applicant

Another advantage of a secured loan is that most lenders will let you borrow more. Depending on the lender, you may be able to borrow up to 125% of the value of your property. You also can usually avoid some of the restrictions that often come with unsecured loans, such has how you can use the money you've borrowed.

Secured loans typically have a longer repayment period. While this means you will be making payments for a longer time, it also keeps the monthly payment somewhat lower. Loan terms can vary from 3 years all the way up to 25 years, depending on the nature of the loan. By contrast, unsecured loans have terms that are much shorter.

As mentioned earlier, unsecured loans often come with restrictions on how you use the money. This is usually not the case with a secured loan. You can use the money for just about anything, including consolidation of other debts or physical improvements that will ultimately increase the value of the property. The latter is very common because the borrower ends up with more equity value and thus owes a smaller percentage of the total value of the home.