When to choose a Personal Loan over a Secured/Collateral Loan?

 Most of us take loans to meet our financial needs, but some apply for them just to improve their credit history or to create one. For any reason, you can choose between unsecured or secured loan options. A secured personal loan has no risk as the borrower pledges a security or asset along with it to recover the loan amount if he defaults. For a loan provider, a secured loan is the best business. Did you know you can benefit from a secured loan too by being a borrower? If you have assets at hand to keep away till the loan term ends, you must do it. The benefits of choosing a personal loan with security or collateral are huge. Take a look at all the benefits before you delve in and borrow.

Benefits of borrowing a secured personal loan

●        Access to various financial products: When you have a security or collateral to keep with your bank, you are open to borrowing various products. There is no loan or line of credit that you can not get. With security, you are an asset and an essential business to the loan provider. You can easily access any loan as per your needs. If you need an instant personal loan, you will get the best deal when you have an asset to pledge.

●        Lowest rate of interest: A rate of interest is the amount that is an extra sum of money paid along with the principal loan amount. This amount should be kept low so that the loan and EMI remain affordable and under control. It is very important to keep your interest rate checked. When you secure your borrowing by pledging a collateral or security, you will get the lowest rate of interest. The EMI will be affordable and you won’t pay a high extra amount every month for the long-term loan.

●        Easy approval: A secured loan has no risk in it. The chances of default if there can be settled with the help of the collateral pledged. If you need an easy approval, you must secure your loan. The lower the risk of borrowing, the better the approval. For a secured loan, the eligibility criteria take a back seat. No matter how low your score is, with collateral things will work in your favour.

Read More: Personal Loan vs. Credit Card Loan-Which is More Feasible?

Finishing up

Keep your personal loan documents at the time of borrowing an instant personal loan from Clix Capital. When you keep your eligibility criteria high, there is no need for any security in a personal loan.