How to build credit score Safe personal loans Low-interest personal loans with APR Starting As Low As 3.49%

Secured Personal Loans

Secured personal loans will come in handy when taking care of unexpected cash needs. That could be your medical bills, home purchases, rent, or an existing loan. We prepared all you need to know to get you started.


We also singled out top secured personal loans lenders you could consider. We prioritized those with low loan charges, reduced interest rates, and flexible repayment terms. Take a look;

  • Rep APR
  • Amount
  • Credit Score
U.S. Bank
  • 5.49 - 16.99%
  • $1,000 - $25,000
  • NONE
Wells Fargo
  • 5.99 - 24.49%
  • $3,000 - $100,000
  • NONE
First Tech CU
  • 7.70 - 18.00%
  • $500 - $50,000
  • NONE
  • APR range
  • Fees
  • Terms
  • Amounth
  • Unemployment protection
Bank 1
  • 6.95%–35.89%
  • Up to 5% transfer fee
  • 3–5 years
  • $1,000–$40,000
  • No
Bank 2
  • 6.95%–35.89%
  • Up to 5% transfer fee
  • 3–5 years
  • $1,000–$40,000
  • No
Bank 3
  • 6.95%–35.89%
  • Up to 5% transfer fee
  • 3–5 years
  • $1,000–$40,000
  • No

Table of Contents

What is a Secured Personal Loan?

Secured personal loans require collateral. You’ll have to pledge your house, car, or any valuable property as security. You can also use liquid assets such as savings accounts as security for a secured personal loan. 


Secured personal loans are risky to borrowers. You could lose your property should you breach the agreement with the lender. However, lenders categorize them as low-risk loans since they have your property to hold on to should you fail on repayment. For that reason, these loans are easier to qualify for. 


Please note that you can keep your property for the whole term of the loan. The lender will only repossess it if you fail to repay your loan. Should the proceeds from the sale of your property be insufficient to offset your loan, you’ll still be responsible for paying the deficit. Know that the process of seizing collateral differs depending on the type of asset and the state laws as well.

Hot Tip:

Please note that you can keep your property for the whole term of the loan. The lender will only repossess it if you fail to repay your loan.

Requirements to Qualify

The basic requirement for secured personal loans is collateral. You must also be 18 years and above and be a legal resident in the US and Lenders will still check your credit score as well. However, most of them won’t. They’ll also check your debt-to-income ratio to ascertain your credit history. You should therefore pay off your existing loans on time.


Having a valuable asset as collateral will get you better loan terms and lower interest rates. Your lender may be offering you a flexible repayment plan.


Defaulting on this type of loan will not only lead to the loss of your property but your credit score will suffer, too. All this should be spelled out in your agreement with the lender. Ensure you understand each term so the lender doesn’t infringe your rights.


It’ll also help to look for lenders with better terms. This will reduce your chances of losing your pledged asset. Another possibility you must consider is to unlock higher loan limits with a previous lender.

Differences between secured and unsecured personal loans?

Here are the key differences you should note between secured and unsecured loans.

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You need collateral to apply: you’ll need to pledge either physical assets such as vehicles, real estate, or machinery or liquid asset such as savings to secure your loan. The value of your collateral should match or exceed your anticipated loan amount.

You don’t need collateral to apply. However, having one could unlock better loan terms.

Lower interest rates: Secured personal loans attract lower interest rates since lenders consider them low risks.

Unsecured loans often attract high-interest rates. They are considered high-risk to lenders. They have no sure way to ascertain that’ll you’ll repay your loan.

Secured personal loans are risky to borrowers. Lenders reserve the right to dispose of your asset and use the proceeds from the sale to repay your loan.

Borrowers don’t risk losing their assets since they don’t have to offer any as security.

Secured loans are easier to qualify for. Lenders will readily offer you a loan as long as you have collateral.

Unsecured loans are difficult to qualify for. Lenders are stricter on your creditworthiness.

Lenders will hardly consider your credit score when offering you a loan. However, having a stellar credit score could open you up to better terms.

Your credit score is the most crucial lender requirement for unsecured personal loans. A poor credit score will have some lenders denying you loans or charging you high-interest rates.

What can you use to secure a personal loan?

You can generally use anything with value as security for your personal loan. However, different lenders will demand different things. Some of which include;


  • Vehicle: You can use a car, truck, or any vehicle as security for your loan. It has to be in a good condition and should be able to fetch money equivalent to the value of your loan upon resale. The lender will need to see the car registration or logbook.
  • Motorcycle: A motorcycle that’s in a good condition and has a good resale value can serve as security for your loan. 
  • Jewelry: Necklaces, bangles, rings or other valuable jewelry can also secure your loan, as long as they are valuable.
  • Land: You can also borrow a personal loan against your land. You’ll surrender the title to the lender and only retrieve it after repaying your loan.
  • Savings: You can also use your savings to secure your loans as long as the amount in question equals or surpasses the loan you’re applying for.


Please note that the lender will dispose of your property if you breach your agreement. Therefore, you’ll want to think through your decision.


You’ll need to prove the ownership of the property you use as security. You’ll use such things as logbooks, land titles, and certificates of ownership for that. 

Hot Tip:

Please note that the lender will dispose of your property if you breach your agreement. Therefore, you’ll want to think through your decision.

How much can you borrow?

You can borrow from as low as $300 to $100,000, or higher. Different lenders will give you a wider range of secured personal loans.


How much you can borrow depends on the value of your security. Valuable collateral will fetch you higher loan limits with flexible repayment terms and lower interest rates. 


Though not a requirement, lenders could consider giving you access to higher loan limits if, on top of your collateral, you have a steady income, excellent credit score, and lower debt-to-income ratio.


Shop around for lenders with more friendly terms to avoid messing up your credit score, or worse, losing your property. 

Where to get Secured Personal Loans

Here are some of the suitable lenders for secured personal loans you can try out;


  • Banks: Banks such as U.S Bank and Wells Fargo offer up to $25,000 and $100,000 in secured loans respectively. Most banks consider both physical and liquid assets for collateral. Their application process is easier and interest rates lower.
  • Online lenders: Upgrade and Avant are some of the best online lenders for secured personal loans. Application is easier and convenient and you can borrow up to $50,000. 
  • Credit Unions: Credit unions such as First tech have different secured personal loan products you can try out. You can borrow up to $100,000, or more, depending on the credit union you approach. Their interest rates are lower and will consider even borrowers with poor credit scores. 


Credit unions are among the best option to consider for secured personal loans. They’ll readily offer you a loan with better terms. 


Online lenders, on the other hand, have a swift and convenient application process. They’ll also check your credit without affecting your score. 

Pros and Cons of Secured Personal Loans

Access to larger loans: Borrowers can borrow larger loans depending on what they have as collateral.
You risk losing your property to the lender should you fail out on the repayment
Lower interest rates: Secured personal loans are considered low-risk by lenders since you offer your asset as security. The lender can sell it and use it to repay your loan should you fail to.
Most secured personal loans have shorter repayment periods. Hence higher loan repayments.
Are easier to qualify for: Lenders will easily offer you a loan as long as you have collateral regardless of your Credit Score.
Available for borrowers with low credit scores: Lenders will hardly consider your credit score to offer you a secured personal loan.

Frequently Asked Questions (FAQ)

If you have a poor credit score, comfortable with monthly repayment, have an asset you can use as collateral, or just can’t qualify for an unsecured personal loan, then secured personal loans are worth the shot.

Anything that holds value. that could be a vehicle, motorcycle, land, or boat. Liquid assets such as savings account and life insurance can also serve as personal loans collateral.

Banks, online lenders, and credit unions are the most suitable lenders. Look for one with better loan terms and lower fees. The lenders on the table above are an excellent pick.

You can do so by making prompt payments. You could also take on the refinancing option like in the case of a mortgage. The new lender will ascertain that the value of your property is worth as much as the loan before paying it off.

Since lenders consider them as low-risk, secured personal loans are easier to get, even for borrowers with a poor credit score. You’ll be open to even higher loan limits as long as you have security.

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