Personal loans are a popular choice for availing instant funds for any financial emergency. However, there are different categories of these personal loans such as secured and unsecured loans.
The names might give you some hints about these two categories of loans, but we are going to help you understand which one you should choose in case of an emergency.
Understanding Secure and Unsecured Instant Personal Loans
A secure personal loan is one where you offer some form of security or collateral to the lender in exchange for the loan amount. These are named secure personal loans as you are offering these collaterals as form of a security to the lender in case you fail to repay the loan amount on time.
Benefits Of Secure Loans Such as:
1. Low Interest Rates
One of the major benefits is lower interest rates as compared to unsecured loans where you have to pay a higher interest rate for the loan amount. With secure loans, the interest rates go to a lower level due to the security of collateral given by the customers.
2. Higher Loan Amounts
With secure personal loans-there is a higher sense of security. Hence, you can get a higher loan amount approved for these personal loans. These loan amounts can further be increased depending on the asset being used as collateral.
3. Long Tenures
Another major benefit of opting for a secure instant loan online is that you get longer loan tenures which enable you to manage all your finances easily and ensure that you have enough time to repay the loan amount.
4. Reduced Risk
Since you have already given collateral for your loan amount, the risk involved is reduced for the lenders, making the whole process simple and convenient for the lenders and for users as well.
5. Convenience
These loans are convenient to avail of and ensure that the users get an enhanced overall loan experience throughout the process, without any hassles and issues.
Let’s Have a look at Unsecured Loans.
Unsecured loans as the name suggests are not secure as there is no collateral involved in the process of the loan. Here the customer doesn’t provide any collateral to the lender in exchange for the loan amount, hence, experiences certain disadvantages as compared to secured loans.
Here the lender is going to use some external factors to verify your repayment capacity such as your credit score, credit history, and income to ensure full repayment of the loan amount.
Given Below are Some More Features that you can Experience with Unsecured Loans:
1. Higher Interest Rates
One of the first points to mention here is the higher level of interest rates that you can experience here. With unsecured loans, a high interest rate is commonly observed to reduce the level of risk for the lender.
2. Higher Risk
Since there is no collateral there is a huge risk involved for the lenders in the whole process which makes them less favourable for lenders to offer you the loan amount.
3. Quick Approval
As there are no assets or collateral involved in the process for evaluation, the loan approval is quite easy and quick. This is done based on your credit score, your income, and repayment capability.
4. Reduced Loan Tenure
With higher risk, your loan tenure is also reduced to ensure that there are no missed payments or late payments for the lenders to ensure complete repayment.
4. Reduced Loan Amount
Lastly, you get lower loan amount approval in unsecured loans due to the level of risk involved and lack of security for the lenders to get their money back in case of any missed repayments.
Based on the above points it is quite simple and easy for you to understand which loans are to be availed in any emergency. Additionally, it is important to find the perfect platform or app to get your instant loans as per your needs.
If you are looking for a personal instant loan you can opt for FatakPay for easy loan approvals, flexible loan repayment structure, loan amounts as per your credit score, minimum documents required, along with a safe and secure platform backed by RBI-registered NBFCs to uplift your overall loan experience.
Conclusion
For availing instant loan online it is advisable to go with a suitable platform like FatakPay and get your instant personal loan with all the available features and best offers in the market. Furthermore, you can choose among the two options of secured and unsecured loans depending on your specific needs and requirements.
For more details, you can download the FatakPay app today and explore the available options and offers.
FAQs:
Instant personal loans are unsecured loans as there is no form of collateral included and these loans are given based on your credit score and repayment history.
To apply for an instant personal loan- first download the FatakPay app and enter the required basic information. Now based on your credit score and history, you will get a loan offer.
Higher credit score, good repayment ability, high creditworthiness, and a government-issued ID for verification, along with a minimum age, and salary background are some of the basic eligibility criteria for instant personal loans.
