Understanding secured personal loans
Personal loans are no longer a one size fits all bank product. Today, they come in many forms (e.g. Secured, unsecured, debt consolidation) to suit the needs of each borrower.
What is a secured personal loan?
Just like in a game of poker, with a secured loan (also known as a collateral loan), if you have something to bring to the table like a car or property and use it as security against the loan, then you might get dealt a better interest rate and lower fees.
Secured loans aren't only available for your current assets, either. If you're taking out a loan to cover the cost of a car, you can usually use the new vehicle you're purchasing as security.
You can also use a secured loan to consolidate your current debt, like a credit card, store card or car loan debt, into one easy to manage loan. Find out more about debt consolidation.
But if you don't have any assets to secure the loan with, you'll need to look for an unsecured loan, which doesn't require collateral to take out the loan.