What kind of loan?
Community building is member-owned institutions exist in the UK and UK Commonwealth countries, providing members with a wide range of deposit account and loan options similar to the products offered by banks. Most housing loan loans are mortgage products, but members can also borrow personal loans. Small businesses owned by members may also apply to commercial loans.
The most popular housing loan loans are mortgages used to buy or refinance residential property. Fixed loans have interest rates that do not change for at least five years. Variable rate loans have rates associated with the base rates set by the national government. These loans tend to have lower rates than mortgage loans, but they rate, change on a monthly basis, and in theory can rise above the fixed loan rates. Building Societies also offers loans with minimal down payment requirements that are aimed at first time home buyers.
Non-traditional housing loan loans include offset mortgage loans. These loans act as fixed-rate loans, but the lender bases monthly payments on the amount that the borrower owes minus any funds that the borrower has on the housing association in savings. The borrower can choose to spend the savings at any time, thus leading the housing association to proportionately increase the monthly payments. Investors can use buy-to-let building loan loans to buy investment homes with minimal down payments.
Building Societies write both secured and unsecured personal loans at fixed and variable interest rates. Secured personal loans are typically used to buy or refinance cars, motorcycles, caravans or boats. The term lasts between two and seven years, and if the borrower fails, the housing association can reclaim the vehicle used as collateral. Unsecured personal loans have higher interest rates than secured loans that reflect the greater risks associated with loans that have no collateral. Borrowers must have both a good credit score and high incomes to qualify for personal loans because the term is short, leading to high monthly payments.
Business owners can lend home loan loans securely in their primary residence or commercial property. Secured business loans usually take the form of revolving variable rate loans. Small businesses can also secure loans against equipment or company owned vehicles. Building Societies help start-ups by offering unsecured credit lines to members. People who want to buy from existing companies can use special buying loans offered by many building communities.