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Online Personal Loans Australia offers both Secured loans & Unsecured loans, so let’s dive in and learn the benefits of each before you commit.
Online Personal Loans Australia offers both Secured loans & Unsecured loans, so let’s dive in and learn the benefits of each before you commit.
Put simply, secured loans use a personal asset as collateral to protect the lender if you fail to honour the finance agreement. For example, if you apply for a car loan, then your car acts as the security. If you continually fail to make repayments then not only will your credit score dip, but also your asset, in this case, your car, can legally be seized by the lender.
However, so long as your honour the agreement, secured loans come with a whole host of benefits including lower interest rates, greater loan amounts and better terms.
An unsecured loan has no ties to any of your personal assets meaning there is less risk if you fail to make repayments.
However, because of this, unsecured loans generally come with higher interest rates and lower loan amounts. It can also be hard to gain approval for an unsecured loan since there is more risk on the lender, and therefore it’s important to ensure that you have a good credit score before applying for an unsecured loan.
If you take out a secured personal loan then you can expect to benefit from an improved chance of approval, better interest rates and greater loan amounts.
Credit cards are a great way to build up your credit rating and come with fantastic perks including insurance, cash back and air miles. However, you can expect high interest rates and difficulty gaining approval.
Being a student, it’s unlikely that you will have too many assets to your name. There is also more leniency when it comes to repaying a student loan. If you fail to honour your agreement you can expect to face lawsuits & a damaged credit rating.
No, this isn’t a typo, personal loans can in fact be both secured or unsecured! If you don’t have any worthy assets or feel uncomfortable using an asset as security against your loan then you can get an unsecured personal loan.
1. Lower interest rates:
2. Greater loan amount:
3. Better chance of loan approval:
