Secured Loans From Spring Finance Review

Spring Finance is a specialist lender that provides residential second charge loans. They are a small team of experienced financial experts, all well-versed in the residential second charge loans market. The team work together to serve a focus customer group of people challenged with adverse credit.

Anyone in need of bad credit, secured loans have a higher chance of approval. Their entire product range of second charge secured loans is based on consumer needs identified through in-depth research of the residential financial market.

Their Aim: To help individuals with a blemished credit history to secure a financial future.

Here’s the catch though: You can’t access finance from Spring Finance directly. They’re broker only and work with a difference. Their in-house underwriters travel throughout the UK to train brokers on using their proprietary technology, so any broker you work with will know if you’re likely to be suited to any of Spring Finance’s product range. 

Note that Spring Finance only serve England, Scotland and Wales. They do not cover Northern Ireland. If you are eligible, Spring Finance have their own UK based processing centre, where applications are dealt with swiftly, allowing for a much faster decision, letting you access finance faster than most lenders.

• Borrow from £5,000 to £100,000
• Variable rates start from 11.25% with fixed rates for both three and five-year deals starting at 11.75%
• They are very tolerant to adverse credit profiles and will consider applicants with an Active Debt Management Plan (DMP) as well as any Individual Voluntary Arrangements (IVA)
• Mortgage arrears must be older than six months, and there’s no limit on the number of CCJs you have on your credit files. Some lenders will restrict this as well, for example, a maximum of four CCJs in the past six years. With Spring Finance, there’s no limit on the number of CCJs you can have to be considered. That’s the same for accounts in default. If you have a lot of accounts currently in default, it won’t directly exclude you from being approved, provided it’s to repay your debts.

With regards to debt, there is an affordability criteria. To assess your ability to repay, you’ll need to provide a list of Income and Expenses and be able to afford the repayments with a 3% stress test applied. In addition, the maximum DTI (Debt to Income) ratio is 45%.

• The maximum LTV (Loan to Value) is 70%
• Your home must have an existing first charge mortgage in place. Unencumbered homes will not be considered.
• There is an upper age limit of 70 years old
• Repayment terms can be arranged from 3 years to 30 years
• Self-employed applicants will be considered, as will applications from anyone with a full year’s employment history. For the self-employed, they do have flexible proof of incomes, and you can use any benefits you receive. They’ll also consider any regular income shown on your bank statements such as from pensions.
• The minimum income you’ll need is £15,000

Fees for Spring Finance

The fees are flexible and can be worked into your total loan amount.

• The lender fee is variable, ranging from £695 to £1,250
• A home valuation will be required. Fees will vary for this. Any loans up to a 55% LTV can use the Automated Valuation Model. If you’re borrowing between 55% and 70% LTV, a full home valuation will be required. Drive-by valuations aren’t available. The minimum home value for your loan to be approved is £100,000. 
• Early redemption fees are a minimum of 3 months interest if repaid in your first year, 2 months interest if repaid in your second year, and from year three onwards, one month’s interest will be repayable.
• Broker fees can be up to 15%; however, the maximum any broker can charge is capped at £5,000

Illustrative Example

Based on a total loan amount of £25,000, borrowing at 11.6% APR on a 15-year repayment term, the monthly payments would be £284.55. Total amount repayable: £51,218.74. The total cost of the loan = £26,218.74

Calculate your own examples using the Loans Calculator of MoneySupermarket.com.

Find out today if you’d be eligible for a Spring Finance loan, and if so, whether they are the best fit for your individual needs.

1^st UK Mortgages is an experienced broker working with an exclusive panel of specialist lenders, all ideally placed to provide secured second charge mortgages to homeowners with a challenged credit profile. Let us help you find the best finance deals suited to your circumstances!