If anyone reading this expects a panacea for the problems of making a living in this market, then I won’t detain you further. But if you are prepared to look with fresh eyes at a neglected part of the lending landscape, namely secured loans, then it might just provide you with another income opportunity and the chance to help more of your clients.

In 2007, at the expected rate of growth the secured loans market was expected to be worth over £50 billion by 2008. However, then came the economic tidal wave and the rest, as they say, is history.

In 2010, as we predicted at the end of last year, the market for secured loans began the long road back to prosperity. Lenders have returned to the market, although not in great numbers yet, but the signs are healthy with more, with whom we have spoken, waiting on the sidelines. Evidence of demand for secured loans is backed up by a growing number of enquiries at good LTVs and with good credit histories.

Fulfilling this demand is only being heldback by the shortage of funding. But the appearance of new lenders and existing ones who are beginning to loosen their criteria all points to a sustainable future. Good quality business will find a home in 2010, but it is fair to say that, although we have access to adverse products, which are still unavailable in the first-charge market, anyone hoping for a wholesale return to the good old days of unlimited adverse credit and unsustainable LTVs is going to be disappointed.

So let’s start with getting some rarely discussed but vital points as to where loans differ positively from mortgages as a simple means of raising capital.

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It still comes as a surprise to many intermediaries that secured loans are free of upfront fees. There are no valuation fees, conveyancing charges or any hidden extras. So the cost for the client is considerably cheaper than for a mortgage whenit comes to shelling out at the application stage.

Speed is a factor that tends to be overlooked in a compliance context. Typically, loans can complete in less than 21 days from application, some in as little as 10 days. When a client needs to move quickly and secure a purchase, then the usual concerns that govern suitability need to be tempered by the time frame in which the client needs his funds. As long as clients are aware of the facts, then if speed is the primary issue, a secured loan willwin every time over remortgage or further advance.

In most cases, secured loans now also have the lowest early redemption penalties in the market. Many loans carry only one month’s penalty, while the rest are never more than two months.

The secured loan as a compliant lending instrument is based on total transparency, where client and intermediary can see exactly what the deal is. The industry has worked very hard to ensure that when a client takes on a second charge, there are no front end charges, rates are competitive and redemption penalties are lower than most first-charge mortgages.

Under TCF, it is important to remember that customers are given the opportunity to see all viable funding alternatives and the consequences for advisers who ignore secured loans when clients are looking to raise capital can be very serious.

Intermediaries have traditionally tended to look at remortgaging or further advance as the only legitimate way to raise capital for clients and yet for many that could mean a change to a more expensive rate particularly if they have been enjoying low rates linked to Bank base through a tracker or variable rate.

There is also a real issue with clients whose credit record has deteriorated since taking out a mortgage. For clients who have a mortgage with a prime lender and have had credit problems, the chances of a further advance are slim. It is just not best advice to recommend a remortgage in these cases where financially the client will have to shoulder the cost of the extra money and the existing mortgage all at a higher rate, when in reality he only needs to pay for the extra funds. If a client is remortgaged, then he has no choice but to accept that he will be paying interest on that extra money for as long as he has his mortgage. He is going to pay a lot of unnecessary interest, when alternatively, with a loan, he can choose a repayment period that reflects his needs.

The best way to make secured loans pay off and save time and money is to look for a good secured loan specialist, who can ensure that your enquiries are matched against a whole-of-market panel. This way, those who might fit criteria but are not the right profile are dismissed at an early stage. It can take out a lot of time wasting and guesswork, ensuring that clients get the best advice available at no cost to you, the adviser.

Secured loans are a simple, transparent, cost effective way to raise capital for most purposes. Intermediaries can recommend them with confidence as an integral part of any proper review of all the funding alternatives available to a client. Not only can loans be a more compliant option than a remortgage, but they are easily assimilated by customers.

Dave Pinnington is business development director of V Loans