Unsecured Personal Loan
If you’re facing emergency expenses or planning for future large purchases, you may want to consider an unsecured personal loan. There are a variety of personal loans that don’t require collateral, making them an option for borrowers who aren’t able to apply for secured loans.
Let’s take a closer look at how unsecured personal loans work so you can decide if one is right for you.
What is an unsecured personal loan?
Unsecured personal loans let you borrow money without providing collateral, such as a house, car, or anything else of value. You repay the borrowed amount over time, along with interest and fees, according to the terms of your loan agreement.
An unsecured personal loan can help you pay for almost any planned or unexpected expense, like a car repair, medical bill, or moving costs.
Types of unsecured personal loans
There are several types of unsecured personal loans available to borrowers, including:
Payday Loans are short-term, small-dollar loans designed to cover expenses between paychecks. You repay them on your next payday, typically within two to four weeks.
Installment Loans are unsecured personal loans that provide a lump sum of money at once. You pay them back over time (anywhere from a few months to several years) through fixed monthly payments. You may want to get an Installment Loan if you need to borrow a large amount of money.
Lines of Credit
Lines of Credit are flexible loans that allow you to borrow up to a set credit limit amount. You can withdraw as much or as little money as you need, and you’ll only pay interest on the amount you borrow. Compared to credit cards, lines of credit tend to have lower interest rates.
Student loans cover educational costs, like tuition and books. Some student loans are federal loans from the government, while others are offered through private lenders.
Credit cards let you make everyday purchases, up to a set credit limit. Unless you pay your balance in full every month, you’ll also pay interest charges. Many credit cards offer rewards you can take advantage of, such as cash back and travel points.
Benefits of unsecured personal loans
There are several benefits unsecured personal loans offer, including:
Easy application process
Many lenders have online applications for unsecured personal loans that you can complete in minutes on your computer or mobile device. You won’t have to go to a physical location.
Depending on the lender and loan type, you can receive the funds from an unsecured personal loan the same day you get approved, within 24 hours, or in a few business days. This is great news if you need to cover expenses immediately.
If you take out an unsecured personal loan, you’ll pay it back through convenient payments. If things change with your income or budget before your loan has been repaid, you might be able to ask about refinancing your loan.
You don’t need good credit
Even if you have poor or fair credit, you can still get approved for an unsecured personal loan. Many lenders have lenient credit requirements and are willing to consider other factors like your income and employment status.
How to apply for an unsecured personal loan
To apply for an unsecured personal loan, follow these steps:
1. Check your credit score
Even though you don’t need great credit for an unsecured loan, it’s still a good idea to pull a free credit report before applying. This way, you know what lenders will see when they check your credit.
2. Research lenders and the loans they offer
The best way to find a reputable lender is to research a lender’s Google reviews and look for them on Trustpilot to see their rating. High ratings and overall positive reviews for a lender mean other customers have been happy with their experiences.
Once you’ve identified lenders you like, compare the rates and terms of the unsecured personal loans they offer to pick the one that’s right for you.
3. Gather your documentation
Make sure you have your ID and financial statements on hand, like recent pay stubs or other proof of income. You may also need information for your bank account.
4. Fill out an application
Visit the lender’s website and complete an online application. Be prepared to share basic personal and financial details. You may also need to upload or email some documents to the lender.
5. Submit the application and wait for the approval decision
Double-check your application for errors to avoid delays in approval and funding. Then, submit it and wait for the lender’s approval decision. Most lenders will let you know within minutes if you’ve been approved.
6. Receive your funds
Upon approval, you’ll receive your funds or gain access to them, depending on the type of unsecured personal loan you took out. Many lenders offer same-day funding, so you won’t have to wait long.
Should I get an unsecured personal loan?
There are some reasons why you might want to get an unsecured personal loan:
- You don’t have a great credit score or are working on building your credit.
- You have an emergency expense.
- You want to make a large purchase.
- You need money quickly, but don’t want to use collateral for borrowing.
If you’ve carefully considered your financial situation, an unsecured loan could be a good option for paying for emergencies or large purchases.
Making your payments on time can build a positive payment history, which can help raise your credit score. A higher credit score means you may be eligible for better interest rates and terms, and possibly be approved to borrow higher amounts in the future.
Get an unsecured personal loan today
Advance America offers a variety of unsecured personal loans that come with easy applications and same-day funding, including Payday Loans, Installment Loans, and Lines of Credit. You may apply online and get your money quickly, sometimes within 24 hours.
Visit us today to learn about our unsecured personal loans and start your application now.