Secured & Unsecured Personal Loans
Posted December 7th, 2008 and last modified December 29th, 2011When it comes to most finance, they either come unsecured or secured. Personal loans are no exceptions.
A secured personal loan is one that is backed by your own collateral in case of the situation where you’re unavailable to pay back the loan. They are typically leased to people who the bank does not completely trust with an unsecured loan, most likely due to some poor credit history. Even with a decent credit score, a very large loan sum may still be secured.
An unsecured personal loan is basically credit that has no direct liability to your own personal assets. As it’s not backed by your own collateral, interest rates are typically higher as there is more risk involved with lending to you.
While there’s no clear-cut winner of the two loan types, there are some significant differences you should be acquainted with unsecured personal loans as opposed to secure.
The Position of your Credit Rating
Since an unsecured loan is leased without backing collateral, you will generally need a relatively positive credit history.
Different Interest Rates
Secured personal loans will fetch lower interest rates than their unsecured counterparts. However, if your credit score is practically flawless, you may be in a position to negotiate for a secured loan rate on your unsecured personal loan. Check your credit history to determine how credit worth you are.
Featured Personal Loan
A GE Money Personal Loan is a very secure way to fund what you want to enjoy now while staying on complete control of your finances. This is because GE Money Personal Loans feature fixed interest rate and repayment amounts for the entire life of the loan so there are no surprises each time you make a repayment.
Features:
- Fixed interest rate and fixed repayments.
- Loans starting from $3000 for most personal loan purposes including – debt consolidation, renovations, holidays or new & used cars.
- Easy application – should take less than 15 minutes to complete.
- Flexibility to choose your own repayments – weekly, fortnightly, monthly or yearly.
- Easy repayment options – Direct Debit, Australia Post, EFTPOS, BPAY
- Low personal loan service fees – $10 per month
- Fast approval – apply now and your funds could be in your account the next working day.
The Secured Process is Longer
One of the prime reasons unsecured loans are sought after is the lengthier process involved with applying for a secured loan. With secured finance, your assets will all have to be valuated and recorded, along with other factors such as the depreciation value of your collateral over the life of the loan. Unsecured loans are also known as ‘signature loans’ as all they basically require is your signature on a one-page application form.
Visit some of the best secured and unsecured personal loans on offer in Australia available for safe and secure online application.
Comparison of Personal Loans
| Personal Loan | Details | Min Interest Rate | Min Comparison Rate | Min Loan Amount | Min Loan Terms | Apply Fee | |
|---|---|---|---|---|---|---|---|
GE Money Personal Loan |
Can be used for whatever purpose: renovating, buying a car, booking a holiday. Funds can be in your count in as little as 24 hours. | 13.99% | 15.00% | $4000 | 2 years | $250 |   |
Aussie Personal Loan |
Consolidate your multiple debts (credit cards, car loans, student loans and other personal loans) in to one low interest loan. | 13.90% | 14.84% | $3000 | 1 year | $199 | |
Sugar Money Personal Loan |
Consolidate your debts or fund a new car purchase with a fixed rate personal loan. Apply and get a decision within 1 hour. | 13.99% | 15.00% | $3000 | 2 years | $250 | |
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