| Many a times, financial crisis makes it difficult for the | | | | - The lender conducts a thorough credit check to |
| life cycle to move smoothly. This is the time when | | | | evaluate the paying ability of the borrower by |
| we look for loans. We can either pledge our house | | | | scrutinising his past records |
| and get the required loan amount and repay it in | | | | - The loan amount can vary anywhere in between |
| monthly installments. But, what if we don't possess a | | | | 500 to 25,000 pounds. |
| home or don't want to risk it? In these events, | | | | - The loan tenure ranges from 6 months to 10 years |
| unsecured loans are the most viable options. These | | | | - The rate of interest is higher than the secured |
| loans give the borrower the liberty to raise funds | | | | loans because the lender compensates for the risk |
| without placing any security. Unsecured loans are not | | | | involved for him |
| guaranteed with any asset, so the risk of | | | | - The processing of unsecured loans is quick because |
| repossession doesn't exist. Though, the lender can still | | | | of the elimination of legal formalities concerning |
| take a legal action and sue the borrower in the court | | | | property evaluation etc. |
| of low, in case he defaults on the repayments. | | | | - Unsecured loans call for less documentation since |
| Unsecured loans are more expensive than their | | | | property papers are not involved |
| secured counterpart because it has greater risk for | | | | - In case of default on repayment, the lender can |
| the lender. | | | | sue the borrower in the court and a CCJ (Country |
| Unsecured loans essentially have the features cited | | | | court judgment) may be issued against the borrower. |
| below. | | | | So, unsecured loans have its pros and cons like other |
| - The sum of money granted by the lending | | | | loans. One should analyse everything logically, keeping |
| institution is not secured by any collateral | | | | one's financial requirements and credit profile in mind |
| - The lender gives the loan solely on the basis of | | | | and thereby, compare unsecured loans and apply for |
| credit worthiness of the borrower | | | | the best. |