Unsecured loans don’t involve any collateral. Common examples include credit cards, personal loans and student loans. … For that reason, unsecured loans are considered a higher risk for lenders. You’ll generally need a strong credit history and a higher score to qualify for an unsecured loan.
Likewise, what are unsecured lending products?
Unsecured loans do not require collateral. They are given on the basis of your credit score and income and include options such as personal loans and student loans. … Unsecured loans usually come with higher interest rates and processing fees as there is an increased risk taken on by the lender in such cases.
- Revolving Loan. A revolving loan is a loan that contains a credit limit, which is the maximum sum of money a borrower can withdraw at any given time. …
- Term Loan. …
- Consolidation Loan. …
- Wedding Loan. …
- Vacation Loan. …
- Festival Loan. …
- Home Renovation Loan. …
- Top-up Loan.
Additionally, what is meant by unsecured loans?
An unsecured loan is one that doesn’t need collateral or a security deposit to receive. Unsecured loans come in three main forms: personal loan, student loans, and unsecured credit cards. Unsecured loans are also known as good faith loans or signature loans. Collateral is required for a secured loan.