Secured loans providers ‘withdrawing from market’

Consumers are having difficulties accessing secured loans, it has been claimed.

Moneyfacts has noted that 14 lenders of the products have withdrawn from the market since the middle of 2007, leaving just three second-charge secured loans providers in the sector.

Spokesperson Michelle Slade said that many lenders have decided that offering the products is no longer a “viable business option” in the wake of the economic downturn.

But she stated that there is still demand for the loans, particularly from people looking for a form of debt consolidation.

“Secured loans offer consumers the option to consolidate their debts over longer terms of up to 25 years … This is appealing to those who wish to reduce their existing outgoings,” Ms Slade explained.

The lack of supply could lead to people seeking an alternative debt solution.

Usage of credit cards has also been declining, with more shoppers opting to use debit cards instead, statistics from Apacs, the UK payments association, have indicated.

By Jamie Price

track

Tell others:

shortlink