Whats the difference between a secure loan and an unsecure loan?
by Author on Thursday, July 29th, 2010 | 5 Comments
Especial for 00? And how do I pay it all back?
I'm trying to travel from NY to CA! And I'm getting kicked out of my parents house! I might want to go to college in CA, since I dropped out of college here in NY and I've been out of work since January!
Which should I get?
Related Credit Card Sites
- Advice for parents of “big kids with even bigger problems” - Books, The Interview - Macleans.ca
- Filipino parents drop sex education lawsuit | ucanews.com
- The Truth as Parents Know It ~ Chris Pirillo
If you enjoyed this post, make sure you subscribe to my RSS feed!
A secured loan means there is specific collateral. For example, if you have a secured loan with a car as collateral, the bank takes the car if you don’t pay. An unsecured loan means the bank must go after your general assets. Only a judge can designate the car as theirs in this case. If you are sure you won’t default, take the secured loan if the interest is cheaper.
A secured loan is backup up by assets you already own. If you default on the loan, they take the stuff.
well, a secure loan is secure, and an unsecure loan is unsecure.
a secure loan is a loan that you are backing with some sort asset. for example when you pawn your car’s tittle for money, you are getting a loan and securing it with your car. or a watch, or the loan on a mortgage. an unsecured loan, it is a loan that has nothing to back up with, other than your name and credit. so if you were to go bankrupt and u had secure and unsecured loans, the judge will make sure that ur secure loans get paid with money or with the assets used to secure it, and potentially can write off the unsecured dept. it is more riskier for the loaner to provide you with an unsecured loan.
You can only get a secure loan if you have an asset. For example, a car loan is a secured loan becuase the car is the asset. If you default on the loan, the bank will take the car, sell it and get some of thier money back. Interest rates on these loans are generally much lower than those on unsecured loans.
An unsecured loan is a loan given to you based solely on your income and credit, there are no assets that the bank can reposess to get thier money back if you default on the loan. Interest rates on these loans are generally very high (10-30%) and these loans are much harder to get apprved for. A credit card is a type of unsecured loan.
If you have no job and no collateral (paid off car, house, expensive jewlery) you will not be able to get any type of loan (why would a bank loan you money if you have no job to repay it with???). You will also probably not be approved for a credit card (at least not one with a 3000$ limit).
If you are going to school, you should apply for FASFA loans through the government (although this will be more difficult if you attend college out of your state of residency, as the price for college will increase 5 or 10 times).