There is one very important and useful group of loans and the group being referred to is home loans, and three main loans are incorporated in this group.

The home loans in this group are mortgages, remortgages and secured loans which are also often called homeowner loans for obvious reasons.

When a person decides that he wants to buy a property , whether he is a first time buyer or otherwise , the next decision is how to fund the purchase and what loan is best needed to fund it , and this is naturally a mortgage.

Very few people have the financial means to pay cash, and therefore most people will have a few mortgages. Property is expensive, at an average price of about 170,000,and as such very few people can pay outright.

A mortgage deals usually stays in place for a certain set time, which can be from one to five years, during which time there would be a penalty to be paid for early settlement.

A remortgage is the moving from a current mortgage lender to a new one, sometimes for the same amount and on other occasions to raise additional funds.

The remortgage pays off the current mortgage and if extra money is taken to pay off credit cards, personal loans, etc, these can all be paid off, and this is known as debt consolidation.

The remortgage of course clears the original mortgage and when used as debt consolidation loans can also pay off credit card debts, etc.

Mortgages and remortgages are the same thing as regards equity, the income needed, etc. The third home loan is secured loans and they have the same uses as remortgages, although their interest rates are more expensive. Secured loans do not pay off the mortgage but rank as a second charge behind it.Never the less thay can be used for debt consolidation, among many other in the exact same way as remortgages.

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