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