What Is The Difference Between A Secured Vs. Unsecured Loan?

If you find yourself confused about secured vs unsecured loan decisions, don’t worry; Idaho Title Loans, Inc. is here to help! Understanding the differences between both options is crucial when borrowing money for your urgent financial needs.

This short article will help you understand how secured options like title loans work. You’ll also discover how unsecured options like installment loans and payday loans work and why they might be a better option for you to consider.

The Definition Of A Secured Loan

Let’s start things off by exploring the definition of a secured loan. Simply put, you must provide collateral to qualify for this kind of loan. Without any collateral, you won’t be able to get approved or receive the money.

The exact kind of collateral you need will depend on the loan’s requirements, though it will be a form of property or asset that belongs to you. Its purpose is to secure the loan amount and reduce the overall financial risk of the lender.

One asset that is commonly used as collateral is a car or its title. For example, you can borrow as much as $15,000 through a title loan from Idaho Title Loans, Inc. by using your car title as collateral. The requirements for a title loan are a state-issued ID, such as your license or passport, a lien-free vehicle title, and the vehicle itself for a quick inspection to determine the value, and in turn, the amount you can borrow.

The Definition Of An Unsecured Loan

An unsecured loan, on the other hand, is a way to borrow money without collateral. Instead, you’ll be evaluated based on other considerations, like your financial history and your ability to make payments, to determine whether or not you can get a loan.

Another notable difference is that unsecured loans typically offer lower loan amounts than secured ones. Consider this when deciding which kind is more suitable for your needs.

Here are two examples of unsecured loans that you can get from Idaho Title Loans, Inc.:

• Payday loans: This option could help you secure between $100 and $500. The requirements for this type of loan are a state-issued ID, the most recent pay stub, and an active checking account registered in your name.
• Signature installment loans: This option could help you get as much as $1,250. The requirements for this type of loan are a state-issued ID, proof of income, and an active checking account registered in your name. 

Understanding your needs and preferences, along with the requirements needed to qualify, is essential before deciding whether a secured or unsecured loan is the better option for you.

Secured Vs. Unsecured: Which Should I Get?

Borrowing money through a loan is a significant financial commitment. That’s why you must consider your options carefully before deciding between a secured or unsecured loan.

Without an asset to use as collateral, there’s no need to consider a secured loan: unsecured options like payday loans and signature installment loans would be better suited to help with your urgent financial needs.

Even if you do have an asset to use, such as a vehicle title, unsecured loans could still be the better option if you prefer. For example, some borrowers have other plans for their assets and prefer to avoid committing them as collateral to borrow money.

Alternatively, if you’re comfortable using them as collateral and want to borrow a larger amount, a secured option like a title loan is worth considering.

How Do I Get A Loan?

Whether you choose to apply for a secured or unsecured loan when borrowing money, one thing is true with Idaho Title Loans, Inc.: The process is transparent, quick, and easy.

Here are the steps you’ll go through to get a title loan, payday loan, or signature installment loan:

Step 1: Submit The Short Online Request Form

You can begin this process at any time by submitting your information through the short online request form. The form will include details like your name, phone number, and ZIP code.

Submitting that form will pass your information on to a representative at a nearby store location who will prepare to call you soon after.

Step 2: Wait For The Call

Keep your phone nearby to catch the representative’s call when it comes in. They’ll use that opportunity to understand your financial needs and explain the entire process to you.

Then, the representative will discuss a convenient time to meet you in person.

Step 3: Meet The Representative

Whether you’re getting a title loan, payday loan, or signature installment loan, remember to bring the required items to meet your representative in person.

This step could take as little as 30 minutes to complete as the representative inspects all the required items to determine if you qualify for a loan.

Step 4: Complete The Process

Next, the representative will help you complete the process with simple paperwork. After a few moments, you’ll find out if you’re approved and, if so, how much you qualify to borrow.

Step 5: Get Paid

Lastly, sit back and wait to get paid. The money could be yours as early as the same day or by the next business day.

Start Your Loan Journey Now With Idaho Title Loans, Inc.!

The secured vs unsecured loan decision is important to understand when you need to borrow money. In a nutshell, you can qualify for larger loan amounts when using collateral to secure the loan. However, unsecured loans offer the ease of not requiring any collateral.

Whether you choose title loans, installment loans, or payday loans, Idaho Title Loans, Inc. is ready to help. Submit the online request form anytime to start your loan journey now!

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.