Following the recent changes to the Consumer Credit Act the £25,000 loan amount limit (applicable under the Consumer Credit Act 1974) was removed as changes from the Consumer Credit Act 2006 came into force. This means that any secured loan funded must be subject to the new Consumer Credit Act regulation meaning the removal of mortgage style redemption penalties and tie in periods. All loans irrespective of amount will now be subject to 28 days notice and 1 month’s interest on redemption at any point throughout the term of the loan.
This is certainly good news in terms for individuals where a secured loan is a suitable option where an individual is in a penalty period and it is not feasible to remortgage then a secured loan can be a genuine alternative.
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