UNSECURED LOAN

Unsecured loans are the exact opposite of secured loans. They include other things like education loans or personal loans. Lenders take more risk in this type of loan, as they have no assets to recover in case of default. This is why interest rates are higher in this type of loan. But you must have some value that can be used as collateral.

An unsecured lender believes that you can repay the loan due to your financial resources. You will be judged on credit basis. The following are some of the basic facts:

Character, ability, capital, accounts, collateral, terms

These are the yardsticks used to assess a borrower's ability to repay a loan, and may include the borrower's position as well as general economic factors.