All About Secured Loans
At Heights, we eat, sleep and breathe personal loans. Every day, we help customers achieve financial success through our personal loan services. Whether it’s covering car repairs or assisting with home remodels, loans are a powerful tool that people can use to accomplish goals and make progress towards the life of their dreams.
20.4 million Americans currently have a personal loan. All things considered, you’d think that information about loans would be pretty common knowledge. Yet, there are plenty of things most folks don’t know, especially when it comes to secured loans. But, don’t worry! We’ve written a handy guide to answer all your questions and get you up to speed.
What is a secured loan?
There are actually two types of loans: secured and unsecured. In a secured loan, you borrow a sum of money which is backed by collateral. With this type of loan, the collateral exists as a sort of “insurance” for the lender. If you can’t make your payments on time, the collateral can be taken by the lender and sold. This is so the lender can make up for their financial losses.
What is considered collateral?
Collateral is an asset or something of value that you offer as security for your loan. Examples of collateral include: a car, house, jewelry, snowblower, lawnmower, precious metals, laptops and more. When you put up collateral, the lender will hold the deed or title until you pay the loan in full. So, for instance, if you offer a car as collateral, the lender will have the title of that vehicle for the duration of the loan.
What is an unsecured loan?
With an unsecured loan, you don’t need collateral to borrow money. That’s the main difference between a secured and unsecured loan. With both types of loans, lenders will review your credit history and scores.
So, which loan should you choose?
While both types of loans have their perks, a secured loan has several key advantages that may make it a sound financial choice. The first is that because you’re putting collateral down, a secured loan may be easier to obtain. Next, borrowers with lower credit scores may find it easier to get a secured rather than an unsecured loan. Plus, secured loans usually allow larger loan amounts, giving the borrower more financial options.
Get a Secured Loan with Heights
Now that you know about the basics of secured loans, you might have a few more questions or be ready to start the application process. Well, don’t be shy! Stop by your friendly local branch or contact us today and we’ll get you squared away in no time. Whether you have questions about the loan application process or want to get started today, we can help. Heights makes the entire process quick and easy, so you can get the money you need fast.