Borrowing money can seem like a rather scary prospect. Especially if you are a young homeowner, or a recent graduate still paying off debts incurred by student loans and the like, the idea of taking out more money again in order to simply survive is intimidating to say the least. And given the current economic climate, it can also seem a little unstable: are we really ok to be borrowing money that isn't ours from banks with unsecured financial deposits in offshore accounts and international lenders also dangerously flirting with collapse?

It is a devastating catch 22. Many of us need such loans to secure a house, a job, and bring in a steady income; yet it now seems that these loans themselves could be a liability, not to mention an expensive enterprise which demands huge interest on the returned instalments. Whether you are an economics whiz-kid or a complete financial clutz, these questions have never been more pertinent.

If you do find yourself in the position where borrowing money seems to be the only way out, make sure you find the right lender, and the right policy. There are generally two types of loans: personal, and secured. A personal loan is usually a relatively short-term hand out of up to about ?20,000 pounds, with less financial guarantees required in order to obtain them. A secured loan is for over ?20,000 and normally requires the applicant to be a registered home-owner: that is, assuredly financially sound and active.

First things first, then, sort out what type of loan you need. Then scout out the differences in offers available from various UK lenders. The best point of comparison is on the typical APR hefted onto your instalments as the interest paid back on the original loan. This is usually higher for secured loans than personal ones as, understandably, the amount loaned is a lot higher. Further, you might want to do some research into the investments and associated clients related to your lender. An example in the UK is Alliance and Leicester, which is backed by the Santander group, and offers APR 8.9% on personal loans and 10% on secured loans. But before you sign anything, couple your online research with a face-to-face chat with a member of staff for peace of mind alongside your financial security.