MEMPHIS, Tenn., Feb. 12, 2014 /PRNewswire-iReach/ -- Even seasoned borrowers are unsure when deciding on the type of loan to apply. The debate about opting for unsecured versus secured loans, traditionally within the domain of academicians, is now making inroads into the discussions of common consumers. While some contest that unsecured loans are better due to the fact that no collateral is required, others claim that secured loans come with higher approval statistics and relatively lower interest rates.
To solve the debate, Personal-Loan.com released its recommendations at http://www.personal-loan.com/Secure-unsecured-loans.html
The newly-unveiled recommendations make a deliberate attempt at educating consumers and borrowers about the subtle differences and pros and cons between the two types of loans. Each has its own share of nuances, according to the release.
http://www.personal-loan.com estimates that over seventy percent (70%) of borrowers prefer to opt for unsecured loans, if they qualify during the application process, whereas nearly thirty percent of borrowers choose secured loans either due to personal preferences, financial circumstances, or credit issues.
Each type of loan has its own share of benefits and drawbacks.
The primary foundation of secured personal loans is that they require some form of collateral (asset) as pledge from the borrower. As a result of the hedge, lenders consider these loans to be relatively "less risky" and often reward consumers in way of lower interest rates, longer repayment periods, higher approval rates, and relaxed credit score requirements. Typical applications of secured loans include auto loans, home mortgage loans, and other forms of secured loans.
On the other hand, unsecured personal loans do not require any form of asset or collateral to further the approval process. As a result, approval rates tend to be lower and credit score requirements tend to be more stringent. Incidentally, unsecured loans tend to be shorter in duration when compared to secured personal loans. Unsecured personal loans are often used in applications, such as short term loans, cash advance loans, payday loans, and other loans with a duration of ten years or less.
"On average, we have seen consumers swinging either ways but consumers generally prefer the convenience of not having to pledge collateral when possible. Unfortunately, credit score standing plays an important role in such situations and those individuals who need to rebuild their credit after an extensive hit often opt for secured loans as a safe starting point," explains Lisa Stinson, who founded the site Personal-Loan.com to help disheartened borrowers qualify for short term and long term loans.
Personal-Loan.com is one of the few sites where borrowers can apply for both secured and unsecured personal loans. With an intuitive user interface and easily accessible tools, users can complete the online loan application process within just a few minutes. Furthermore, funds are directly deposited into the individual's bank account within hours. A robust network of lenders powers the core functionality of the process at the site.
Media Contact: Lisa Stinson, Personal-Loan.com inc, (872) 222-9076, firstname.lastname@example.org
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SOURCE Personal-Loan.com inc