Today's unsecured personal loans are somewhat harder to obtain, but also a better choice than cash advances, high interest payday loans, or collateral loans. An unsecured personal loan is basically a signature loan, different than a loan for which you risk collateral such as your house or vehicle. If you default on a collateral loan, the lender can place a lien upon your collateral, or even take it as payment for the unpaid loan if you do not repay. An unsecured loan is basically a loan upon your good word that you will make good on the repayment. You are risking nothing material, just your good credit record.

In order to qualify for an unsecured personal loan in today's economic situation, it is necessary to have a good credit record, and a long relationship with the lender can also be helpful. The credit market is very much under stress, and qualifications have become tougher. Usually a personal loan carries a fixed rate, much lower than you would get from a no credit, bad credit, and instant, same day payday loan. It is also called an installment loan. You pay a fixed payment every month for a set period of time. For example, borrow $1000 over one year and repay in 12 equal payments that include interest. There may be fees, early payoff penalties, late fees, and you may have different repayment options available.

Reasons for obtaining an unsecured personal loans in today's economic situation include:

Debt consolidation

Emergency expenses or repairs (home, car, medical)

Furniture or appliances

Educational tuition

Moving expenses

Vacation expenses

Special purchase, like stock

Cash on hand needs

When seeking an unsecured personal loan in today's economic situation, be sure to do some research into lenders. Find out how long they have been in business, what other options you may have with them for loans, their reputation, possible consumer references, consumer complaints, and any risks, such as internet related identity risk.

Making regular payments, on time, for the duration of the loan period is very important to maintaining your clean credit record. These financial products are for your convenience, and can be very helpful. Use them as a debt consolidation loan, by grouping together all your debts into one convenient monthly payment. Usually this one payment monthly is less than the total of all the other payments combined, but it may run for a longer period of time to payoff. You can thus convert some of your other collateral based loans into an unsecured, no collateral loan, thereby reducing your risk of loss if the unfortunate happens and your are unable to pay the loan back.

In most cases, these loans are wonderful, and a great way to manage your finances. Strive to create a good budget, so that after this type of loan is repaid, you have better control of your money and do not need to borrow because you can now grow a savings account. Pay yourself first, borrow from yourself if need arises, without interest.