Unsecured borrowing popular for home improvements

Once the Christmas and New Year period is over many people in the UK start to think about home improvements to spruce their homes up ready for the spring and summer.

However, in order to carry out home improvements, particularly larger home improvements, the necessary funding is required, and for many people this means raising finance by borrowing money in the form of a loan.

A rising number of people are deciding to carry out home improvements in the UK according to recent data, and the results of a recent survey also show that consumers in the UK are increasingly turning to unsecured finance in order to find home improvements rather than relying on a loan that is secured against their property or using their savings.

Around one and a half thousand pounds per household per year is being spent on average by homeowners in the UK on taking on professional contractors to help with home improvements, with increasing number of homeowners taking out an unsecured loan for this purpose.

However, experts have urged consumers to ensure that they compare the interest rates on these unsecured loans, as they can vary dramatically from one lender to another, and also to see whether there are better deals available in the form of a secured loan.

One financial expert said it is important for consumers looking for home improvement loans to look at the various options and do their research in order to get the best deal.

He stated: "Personal loans can vary in price dramatically – you could end up paying back as much as a quarter of the amount you borrowed in extra repayments unless you research the market carefully"

In many cases, say some experts, homeowners may find better value deals through secured finance, with a range of competitive secured loans available for home improvements.

Tom Smith
20.02.07

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