So now we have looked at the details of the secured loan, we need to take a look at its sister product, the unsecured loan, also known as a personal loan. As with the secured loan you need to assess your situation as they will determine which type of loan you will need.



If you do not wish to borrow an amount over 25,000 then you can look at a personal loan, this is more popular than the secured loan as no collateral is needed. You will basically plea your case to the bank and they will decide whether it is a good idea to lend you the money, this will heavily depend on how much you want to borrow, how long you intend to repay it back, your income security and most importantly your credit rating.





The interest you pay back will also depend on these factors, reducing this can easily be done, simple things such as shortening the repayment period and improving your credit score. You can improve your credit score in many ways, pay off any outstanding debts and try not to go overdrawn with the like of phone or gym bills. A high credit score will see your request for money being rejected or at best your interest being sky high.



Your credit score is pretty much your financial track record, if you have borrowed money in the past and failed to repay it back on time then the lender may not feel comfortable borrowing such a high amount.



Personal loans cannot be used for business purposes.