Find Unsecured Loans with No Collateral

Unsecured loans can be used for a wide variety of things. Here are some of the most common uses.

Debt consolidation: Consolidate high-interest credit cards into one monthly payment.

Medical expenses: Get the collection agencies off your back with a loan that allows for easy monthly payments.

Major life events: Life events like a wedding or a family emergency can be a big expense, and an unsecured loan can help spare you the financial worry.

Home improvement: Getting a new roof or replacing worn out appliances costs thousands of dollars. An unsecured loan can provide you with the cash you need to make your home more comfortable or safer.

Emergencies: Do you have enough money in savings to cover a sudden expense? An unsecured loan can help you breathe easier when an emergency hits.

Treat yourself: Sometimes it’s hard to save up the money to make dreams happen, but a loan can provide you with the opportunity to make your dreams come true.

There are four common types of unsecured loans.

1. A simple, unsecured loan through obtained through a bank, credit union, or online lender. These are offered with no request for collateral and are used for things like emergencies, home improvement, or travel.

2. A student loan for postsecondary education. Both federal student loans and private student loans are unsecured. Though these are unsecured loans, your tax refunds are subject to seizure if you default.

3. An unsecured line of credit, which works much like a loan, but allows you to take out money as needed instead of in one lump sum. Most lines of credit are secured, such as through a home equity loan, but it’s possible to find unsecured options.

4. A credit card. Most credit cards don’t require collateral. Instead, they rely on your credit history and creditworthiness to determine how much you can borrow.

You might be able to get an unsecured loan with bad credit, but the worse your credit is, the higher your interest rate might be. This is because the lender is taking on more risk by giving you a loan. Regular, on-time payments can boost your credit quickly.

Unsecured loans are often faster to get, as you don’t have to go through an appraisal of your collateral. They can also provide more peace of mind as they are not tied to your personal property.

In some cases, you can’t get a loan for less than $5,000, so if you only need $2,000, you might be taking out more than you need. Paying it back early could also be an issue because some lenders have a prepayment penalty. And since there is no collateral required, you might pay a higher interest rate than you would with a secured loan.

Most unsecured loans range from $5,000 to $50,000, but there are some lenders that can go up to $100,000.

That depends on your financial situation. If you need a higher amount or have poor credit, a secured loan might be your best bet. But for many people, an unsecured loan is the way to go for peace of mind.

That depends on the lender. All lenders prohibit you from using the funds for anything illegal, but others may prohibit the use of funds for other things, such as postsecondary education. Check with your lender to understand the restrictions.

That depends on the lender. Some can give you the money during the same business day or a day or two after your application is approved. Others might take a few weeks, especially if there are any questions about your income or credit history.

In most cases, yes. But in some cases, you might face a prepayment penalty if you pay off your loan well before the final payment is due. That’s because the lender wants the interest they were promised when you took out the loan. Check to see if there is a prepayment penalty before you sign the paperwork.