Unsecured loans are available from banks, building societies and other lenders.
Such loans are considered higher risk because the only security the lender has is the promise (covenant) by the borrower to pay the money back.
Interest is payable on the loan which is how a lender makes money from the transaction.
Usually the interest rate is set at the beginning of the term and it carries on without variation through to the end.
Typically, an unsecured loan term runs for only six or seven years, with a maximum borrowing limit of up to £25,000.
A credit check will usually be carried out by the lender who will also take into account other factors, including age, employment history and more.
The successful borrower will have demonstrated to the lender his or her ability to pay back the loan.
The money can be used for a variety of purposes such as buying a car, a holiday, or to consolidate other high interest borrowings.
Unsecured personal lending not only takes the form of unsecured loans or personal loans, but also bank overdrafts, and credit card and charge cards.
A final point - notice the loan application form? We make it really simple to apply online. Fill it in and we'll put you in touch with lenders who'll give you a deal you'll be very happy with!
