When it comes to flexibility, perhaps no other loan product can beat personal loans. They can be used for a variety of purposes, though one has to mention a particular purpose when applying for the loan. This flexibility has made personal loans the most favourite type of loan product with consumers all over the world.



You can use a personal loan for purposes like

Going for shopping,

Meeting your holiday expenses,

Paying off your long medical bills,

Consolidating your past debts,

Paying for an expensive wedding in your family, and

Financing the education of your child

Like most other loan products, personal loans too are of two types: secured and unsecured. A secured personal loan is usually secured against collateral in the form of a property or house. This security allows the lender to allow flexible terms and conditions for the borrower. The borrower has the option to choose lower interest rates and longer repayment term. A long repayment term brings down the monthly instalment considerably for the consumer. However, secured personal loans take a little time for disbursement due to evaluation of the collateral and the subsequent paper work.



An unsecured personal loan does not require you to furnish collateral. The absence of collateral however makes it difficult for the lender to grant the loan on easy terms and conditions. The interest rates for such loans are usually higher and the repayment term is short. The borrower also runs the risk of losing his property that he has offered as collateral in case he fails to repay the loan within the stipulated period. However, these loans reach the consumer fast because of the absence of collateral and minimum paper work.



Personal loans can be availed by people with bad credit record too. It must be kept in mind however that lenders prefer granting a secured personal loan to granting an unsecured personal loan.



Before you apply for the personal loan, please spend some time on the Net going through the rates offered by different online lenders. This will help you choose the best plan for yourself. Also, apply online to save time and paper work.