Loan Type Part 2. Secured and Unsecured Loans

In the second part I will discuss about Secured Loan and Unsecured Loan. The word "Unsecured" here does not mean unsafe, but without security. For more in let's compare these two types of loans from the point of understanding it first.
Secured Loan is one way of using a credit-value assets such as homes, cars, etc., as collateral for the loan, which we proposed and of course the loan, which we proposed should not be higher than the price that we mortgaged assets. The system works on this type of loan is, that when a borrower can not cover the proposed loan in the collateral pledged will be taken by the borrower in exchange for covering the amount of the proposed loan before.Therefore, do not ever borrow if you not sure could return, or you will be seized assets instead.
To make things more clear, I love this example:
- Your home mortgaged certificate to borrow money in the bank.
- Buying a new car on credit, so if it can not make the repayments then the car will be taken by the lender.

Unsecured Loan, to do this type of loan you do not need to use your assets, because these loans are given based on a survey of income and your expenses, usually seen from your credit history. The greater your income and electrical loads then likely you will obtain a loan that great anyway. Because there are no guarantees in this loan then the interest charged was also relatively large because the borrower does not have any guarantee if we do not pay the loan. When you can not pay the debt then the borrower will sue you through the legal channels.

Here is an example of unsecured loans:
• Personal loans are the most common form of unsecured loan, which is referred to as a loan all purposes, they are ideal to buy products that you do not have ready liquidity.
• Card Credit card loans are the most flexible form of short-term loans with easy repayment options.
• Unsecured Business Loans, as the name describes is a type of loan that does not require collateral. It is usually at a higher interest rate and taken to tenor relatively smaller.
• Bank Overdraft also a form by which you can avail unsecured financing from your bank for your business.