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Secured loan debts. What can happen to my home

A secured loan is a loan attached to your home. If you cannot pay the debt, the lender can apply to the courts and force you to sell your home to get their money back.

Because lenders have security of your home, they may:


  • Offer lower interest rates than on other types of lending
  • Lend to people with a poor credit history who would not get an unsecured personal loan

You may find that you can borrow more through a secured loan than you can through a personal loan.

If you miss payments to a secured loan, you could lose your home.

You may have seen adverts for secured loans on TV. They are often advertised as debt consolidation loans. This is a way to put all your debts into one loan. It might sound appealing, but it comes at a very high risk.

Need help with secured loans?

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Maybe it is a strain to keep on top of monthly spending. Or you don't know what to do when your fixed rate mortgage ends.

Together, we can look at your situation and unlock your options.

Read our homeowner guides.

Frequently asked questions

What does a 'secured' loan mean?

A secured loan is a loan attached to your home or a property you own. If you cannot pay the debt, the lender can apply to the courts and force you to sell your home to get their money back.

Find out more about home repossession.

How does a secured loan work?

The lender will make you an offer on the basis that they have the right to repossess and sell your home if you fail to make payments.

Because they have security of your home, they may:


  • Offer lower interest rates than for other types of lending
  • Lend to people with a bad credit history who would not get an unsecured personal loan

They should still check that you can afford the payments.

You may find that you can borrow more through a secured loan than you can through a personal loan.

Can you pay off a secured loan early?

It depends on the agreement. Make sure you understand the terms of the loan before you sign up.

There are often penalties for paying off secured loans early. These are known as "early repayment charges".

Are you looking for information about loans to consolidate debt? Find out about secured and unsecured debt consolidation.

Secured loans and debt consolidation

Many secured loans are offered as a way to consolidate your debts. The interest rates are lower than unsecured personal loans because the risk to the lender is reduced when the loan is attached to your property.

The lower interest rates for a secured loan can make them seem like a good option for debt consolidation. But if your situation changes and you cannot afford to pay the loan, the lender could take action to repossess your home.

If you are thinking about consolidating your debts, it could be a sign that you are finding it hard to pay your existing debts.

In this case we would recommend getting expert debt advice on your available options before securing a debt to your home.

We can help

If you are:


  • Finding it hard to pay your debts
  • Thinking of taking out a secured loan

Please speak to us first.

We can provide expert debt advice to find a better way to deal with your debts, rather putting your home at risk.

Our free debt advice is tailored to your personal situation. Use our online debt advice tool or contact us for free.