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Personal Loans Are Not Secured Loans

Jan 23, 2008
Would you like to obtain a loan that is truly hassle free? Many loans today require that you secure them with something and if you don't own a home you may not have anything to secure a loan with. Personal loans are the hassle free loans, that is, they are not secured loans. You can simply apply for the loan, provide your personal information, and either be approved or not. No need to bring your home into the process.

Securing a Loan without a Home

If you need a loan but you haven't applied for one because you assume that you need a home to get one, you are wrong. In fact, there are personal loans out there that are perfect for those that do not own a home. Many people who do have homes never consider personal loans because there are many loans that they can take advantage of because they do own. When you do not have anything that you can secure a loan with that doesn't mean you are out of luck, it just means that you need to look at personal loans.

Personal loans are not secured loans; they are general use loans that anyone can apply for. When you apply for these loans you will need to provide information such as your social security or taxpayer identification number, your home address, your bank account information, pay stubs, and any information on other debts that you have.

Your bank or lender will use this information to run a credit check and look at your debt to income ratio. Basically, the lender wants to make sure that you can afford the loan and that you have the means to pay it back. In addition, they want to make sure that you have a history of repaying your debts.

Because a personal loan is not secured you should know that they are not handed out to everyone who applies. You should have decent credit if you apply for one of these loans and expect to be approved. You will also want to have a stable job and be willing to pay a bit more in interest than you might if you sought out a secured loan such as a home equity loan.

The interest rate is usually not much higher, but you may find that they are a couple points higher and this is just the way the lender balances the risk. Remember, this is business for the lender and they need to make sure that they are going to get their money back.

Personal loans are a great option if you need money to consolidate debt, pay for medical bills, pay for car repair, repair the home, go on a vacation, or even go to school. Again, these are general use loans that come in handy in a multitude of situations. The great thing is that these loans can often be funded in as little as 24 hours, so you will be ready to go shortly after applying for the loan.
About the Author
By their very nature, personal loans tend to be unsecured. Of course, if you are a homeowner, you could look at secured loans as a great option. All this and more at comparethem.co.uk.
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