Personal Loans India : Secured VS Unsecured Loans
While personal loans are not necessarily popular with banks (because of the relatively small size of the loans, they do not tend to make the bank a lot of money), they are definitely popular with customers.
Secured loans require some form of collateral, such as a house or a car, to protect the lender’s investment. Unsecured loans are exactly as they sound – unsecured. One reason for the popularity of the unsecured personal loan is that it is a lot less risky to the consumer; your personal property will not be on the line if you are unable to repay it. Bear in mind, however, that you will be paying a higher interest rate than you would with a secured loan.
A Versatile Funding Source
There are many reasons that consumers find these loans so appealing – they have fewer restrictions than a lot of other loan types, so you can use them for anything you would like (as long as it is legal, of course!).
This makes personal loans ideal for events such as weddings, vacations, dental work, etc. A personal loan may also be a good option if you are looking to round out student loans that do not quite cover all of your expenses. Many consumers find them to be a good alternative to credit cards, as well. With credit cards, you may be tempted to pay only the minimums, and can get caught in a downward spiral of debt. With a personal loan, the terms are clear, and you know that once it is paid off, you are done.