Loan

Oct 31 2016

The Basics of Personal Loans (5 Things to Know) #lenders

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Basics of Personal Loans

By LaToya Irby. Credit/Debt Management Expert

Welcome to About.com s Credit/Debt Management site, led by your guide, LaToya Irby. LaToya has been the credit and debt management guide since 2007. Read more

Personal loans are one of many types of loans you can borrow from a bank. These loans are typically general purpose loans that you can use at your discretion. Personal loans are often more difficult to get and have strict qualification requirements. If you re thinking about borrowing a personal loan, here are some things you know about them.

Personal loans are unsecured.

So, if you default on a personal loan, the lender can t automatically take a piece of your property as payment for the loan. This is the primary reason that personal loans are more difficult to get. The lender doesn t have any asset to seize if you decide you can t make loan payments anymore. Even though the lender can t automatically take your house or car, it can take other collection actions. This includes reporting late payments to the credit bureaus. hiring a collection agency, and filing a lawsuit against you.

Personal loans have a fixed amount.

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