It is often said that personal loans are the most ?generic orbasic? form of all loan categories ? other major categories beingmortgage and commercial loans. As mortgage and commercial loans areexclusive categories with specific scope, the market share of thesetwo is not as big as that of the personal loan category. So, what arepersonal loans?
Today, lending is a full-fledgedcompetitive industry, as most lenders are offering personalised loandeals to target maximum number of loan seekers. The growingcompetition and the aforementioned flexible range of products havemade the personal loan category even more affordable. As a result,more and more people are conveniently availing them even forlifestyle purposes.
Some of the most saleable personal loanproducts are: bad credit loans, business loans, car loans, careerdevelopment loans, cosmetic surgery loans, debt consolidation loans,education loans, holiday loans, homeowner loans, home improvementloans and wedding loans.
The above-mentioned range of products proves that ? segregated under secured (credit against collateral) andunsecured (credit without collateral) sub-categories ? offerdiverse financial solutions.
Secured type of personal loans ensures maximum loanbenefits. Designed only for homeowners and property owners, thissub-category is most suitable for loan seekers who have a bigmonetary requirement, and are capable and willing to offer somethingvaluable as collateral
Unsecured type of personal loans ensures fast loanapproval. Designed only for tenants, homeowners, property owners andstudents as well, this sub-category is most suitable for loanseekers who have a small and temporary monetary requirement, and areincapable or unwilling to offer something valuable as collateral
Please note: Decision of choosing between thetwo sub-types should be based on credit requirement and overallfeasibility. And, for that a clear understanding of the advantagesand disadvantages of both sub-types is essential.
Also, to avoid unpleasant surprises in the future, loan seekersshould avoid hasty decisions and gather as much information aspossible from as many lenders as are available in the loan market ?both online and offline. Basically, they must get a fair idea of themarket trends.
The approval of a personal loan application and finalisation ofthe terms and conditions is subject to the lender's credit policyand the borrower's residency status (UK residents only), age (18years and above), credit history (good, average or bad) employmentstatus (future payback ability), debt to income ratio (currentfinancial standing) and the value of the pledged collateral (in caseof secured credit only).
