It is true that secured personal loan carries low interest rate but along that this is also a fact that it carries risk on the asset placed as collateral. There is a great risk on the assets which arises due to non-payment or irregularity while making repayments. Owing to this, there are many people who do not want to put their asset as collateral. So, for them the best means of finance is unsecured personal loan.
In unsecured personal loan, the borrower is not needed to place any collateral against the loan amount. The borrower can avail unsecured personal loan from either of the sources available:
- Physical market lenders ( such as banks, financial institutions and various building societies)
- Online lenders
It doesn’t matter that from where the borrower avails unsecured personal loan. But, it is seen that online lenders offer better rates as compared to other sources. The best thing about applying loan with an online lender is that it involves no processing fee and low overhead cost, which makes the whole loan deal cheaper.
As mentioned above that it carries low interest rates, which are competitive in the financial market. The lender usually offers two types of interest rate that are flexible rate of interest and fixed rate of interest. And, the borrower can choose as per his needs and financial position.
Unsecured personal loan can also be availed by both good credit scorers and bad credit scorers. Usually it is seen that bad credit scorers are offered with high rates. However, by means of research and comparison, bad credit scorers can also avail loan on competitive rates. But, they must try to make timely repayments of loan in order to improve their credit score.
Lastly, the borrower is recommended to borrow an amount in regard to his repaying ability.
It carries low interest rates, which are competitive in the financial market. The lender usually offers two types of interest rate that are flexible rate of interest and fixed rate of interest. And, the borrower can choose as per his needs and financial position.