| Britons' today are borrowing more money than | | | | exactly fit any of these either. |
| at any other time in our history. With such | | | | |
| huge sums being borrowed on personal credit, | | | | Unlike secured loans, with an unsecured loan |
| UK banks are acutely aware of the potential | | | | you do not agree to give security over an |
| for huge profits. However, unlike the days | | | | asset in return for borrowing money from the |
| of past, in today's market banks need to be | | | | bank. As such, if you fail to repay the |
| ever more innovative with the marketing of | | | | loan, the bank effectively risks losing all |
| their loan schemes if they're going to have | | | | of the money it lent to you. Because of |
| any chance of capturing your potential loan | | | | this, the bank will normally charge higher |
| business. So, what type of UK loan do you | | | | rates of interest on an unsecured loan. |
| have? | | | | Also, in most cases, the amount being lent to |
| | | | you is smaller than you can usually borrow |
| Nearly every single loan in the UK will still | | | | with a secured loan. Typical types of |
| fall within one of two very broad | | | | unsecured loans include the standard personal |
| classifications - what is known as a | | | | loan, holiday loans, student loans, payday |
| 'secured' loan, or, alternatively, an | | | | loans, and, in some cases, debt consolidation |
| 'unsecured' loan. With a secured loan, you, | | | | loans. |
| as the borrower, agree to provide the bank, | | | | |
| as the lender, with security to give the bank | | | | While the general parameters of what |
| some assurance that they'll be repaid the | | | | constitutes a loan remain the same, what is |
| money you borrow. Generally, in exchange for | | | | changing on an almost daily basis is the |
| agreeing to give the bank this security, the | | | | names being given to these loans as banks try |
| bank will agree to offer you a marginally | | | | various different ways for you to sign up to |
| lower rate of interest on the borrowing than | | | | their latest loan promotion. And this is one |
| you would otherwise have been charged on an | | | | practice that banks have implement that you |
| unsecured loan. As such, the traditional | | | | can be sure will not change in the near |
| types of secured loans you'll find on offer | | | | future. But before you agree to complete the |
| include home mortgage loans, home improvement | | | | UK loan application form, take the time to |
| loans, re-mortgage loans, home equity | | | | make sure you know whether you've just signed |
| withdrawal loans, and, in some cases, car | | | | up for a secured or unsecured loan, as this |
| loans. Just as all of these can be unsecured | | | | could have a very important impact on what |
| (although in some cases, such as a home | | | | happens if you're ever in the position where |
| mortgage loan, this would be rare), it's also | | | | you cannot repay the loan. |
| possible to have a secured loan that doesn't | | | | |