With so many loans and loan companies on the market to choose from it makes sense to compare personal loans. You have a number of options available to you form our leading lenders and your choice will depend on whether or not you are a homeowner, your circumstances and loan preferences.
When you compare personal loans which are secured to those which are not, there are a number of important differences. Secured loans require the borrower to provide the lender with collateral or security to back the loan, and this will be their home or property. Unsecured loans do not have this requirement. Because the lending company is taking a relatively low risk with your home acting as insurance against your failure to repay the loan, interest rates on secured loans are lower than for unsecured loans. It is wise to make sure that you can afford the repayments on a loan before you commit to an agreement as you will be placing your home at risk of repossession if you fail to repay the debt. Even in the case of unsecured loans, lenders have been known to act aggressively in order to protect their investment and will take defaulters to court if necessary. Apart from the differences in interest rate and risk you'll find that when you compare personal loans which are secured and unsecured, secured loans are approved faster than unsecured loans but will take longer to be processed. This means that you will wait a little longer for your money to come available with a secured loan but it will be well worth the wait when you are ultimately saving money on the interest rate.
Personal loans are available for various amounts and repayment terms and are repayable on a monthly basis. You will be charged interest by the lender and this is known as the APR or Annual Percentage Rate. When you compare personal loans, looking at the APRs is a good indication of just how competitive they are. Lending companies advertise typical interest rates but these are merely indication rates of what you are likely to be offered. The interest rate you are given is determined taking a number of factors into consideration, including the amount you are borrowing, the length of time you will take to pay back the loan and your personal circumstances and credit history. You will also notice that lenders refer to fixed and variable interest rates. If you compare personal loans with a fixed rate to loans with a variable rate there is one major difference. A fixed rate means that the amount of your monthly repayment is fixed for the entire term of the loan which makes it easier to budget as you know exactly how much you'll be paying each month. With a variable rate your monthly repayments could go up and down along with fluctuations in the bank base rate. This gives you the flexibility to save money if the interest rate drops but your loan could also end up costing you more if the rate goes up.
A further consideration when you compare personal loans is to check the redemption penalty policy of the lending company. Some companies charge up to two months interest if you pay your debt in full earlier than agreed at the outset. If you think that you may want the option of settling your debt before the due date than it may be worth your while taking a loan with a slightly higher APR but with no redemption penalty.
Got a Question? Ask.
Ask the community a question about this article:
Frequently Asked Questions
Commodity trading (oil gold ) how to get started?
By: Roger | 16-08-2008
Got a question about personal finance? Type your question here...
Real estate and finance blues.....
By: LFTA | 16-08-2008
I just turned 58 my husband is very ill and has been in the hospotal for 9+ months. I have two rental properties that I am taking a loss on each month. I have used them for tax write offs's but the notes are high and well you know the the housing industry story. My 23 year old dauhgter said that I should sell the 2 properties and take the loss then begin saving the money I am paying for the mortgage on the rentals and maybe make some extremly conservative investments. One of the condo became vacant yesterday. It is a 2 bedroom condo in Las Vegas, Should I try to sell it and take her advise?
Im serios, are you???
By: Boricua81680 | 16-08-2008
Senator McCain has offered 300 million to someone who has a solution to the current energy crisis, I don't trust him, and believe that I have that Solution, I have the knowledge that would produce a car that never needs to be recharged or plugged in to a socket and once you purchase other than changing the breaks or a tire you would never have to stop at to fill up again, and the sad part is it is all common sense and involves technology we already have used in a different way , my only problem is , is how do I present this without some one taken the idea for themselves,, I'm not looking to make billions or millions for that matter, the truth is I only want to die in piece because I happen to have a rare form of Muscular dystrophy and feel as though I've never been given a fair chance at life. I will gladly show proof of this to anyone who wants it, I was diagnosed at the Eastern Virginia Medical School in 93 after being told for 13 years I was just slow and clumsy and nothing was wrong with me, now I'm dyeing . I have this knowledge and would like to share it with someone who wont cheat me out of it, I don't even have the money to file a pending patent, Please help me , there is no BS involved , all I ask is that you sign a notarized statement saying that I'm to get at least 40% of profits ( half of mine will for sure go to charity, it you want I will get that notarized in writing for the person that is helping me) I refuse to accept offers by oil company's as well, one if the conditions of my inventions are that it be made available to the public, I would love more than anything to present this to someone such as Bill Gates, Warren Buffet or even T.Boone pickens, but how do I reach them, I lived a hard life and am bitter against the world right now and this is a last cry for help, I prefer not to even be known or my identity be known , my only desire is that my existence, my time in this world not be for nothing. All I need is someone to take my knowledge and put it into motion
Are there any major banks that specialize in women ...
By: Karen | 15-08-2008
Are there any major banks that specialize in women's loan or mortgages.
How to go about getting food stamps in the ...
By: depressedaboutmoney | 15-08-2008
How do I go about getting food stamps? My husband's in the military and an E-4 and is injured and we are losing 150 bucks a pay check and it's killing us. We have a 19 month old and after our bills come out we can't afford to buy groceries for him or I. We're based at Fort Bragg so if anyone up here knows how to do it please let me know where to go and so forth. This would really help us out greatly.
Reparing credit
By: clare | 15-08-2008
After my recent divorce i was left with about 50,000 in credit card bills, i recently settled on all except two and now my fico score is in the toilet for late payments and such, how do i repair my score to qualify for a decent loan to buy a house and about how long will it take. Thank you.
Q&A Powered by:
Finance 
