In the market for a loan but not sure which kind to take on? There are two types of loans available, there are secured loans and unsecured loans. An unsecured loan does not require any collateral while secured loans require some amount of collateral.
Why go with a secured loan?
Having a secured loan means that you are willing to put down some money to gain access to a line of credit. The money you put up as collateral is typically seen as a security deposit.
Timeframe for a secured loan?
Since secured loans require not only a form of collateral, they also require paperwork to confirm the loan – they will require more time than a standard unsecured loan. If you need quick cash, a secured loan may not be the way to go.
Why do I need to put down collateral for my loan?
When you take on a loan, specifically a secured loan, by putting up collateral you are saying that if you default or unable to pay the remainder, they can use what you put up to pay off your debt.
Where can I get a secured loan?
Many payday lenders won’t offer a secured loan, as that is not where their business thrives. Their business thrives on short-term and revolving loans. To get a secured loan, you would visit a bank or credit union. They are able to do the paperwork and provide you with a low-interest secured loan.
Though the process of getting a secured loan may be time-consuming and long – for some it may not be their first option either; however, having a secured loan is one way of ensuring you don’t fall into a cycle of dependency with short-term loans. Not to mention that with secured loans, the interest is much lower than that of an unsecured loan.
The next time you are in a bind and need some money – consider the option of a secured loan over an unsecured one.