These loans are not secured on property, they are advanced on the assumption that you will repay the loan on time. Interest rates are higher than with secured loans, and 2. Adverse credit history of almost any kind will disqualify your application It would not be true to suppose that defaulting on an unsecured loan cannot put your home at risk. A lender can obtain an order from the court forbidding you from selling without repaying them. However, it is a less straightforward process than calling in a secured loan.
Unsecured loans are available to both homeowners and tenants.
However, homeowners will almost always benefit from lower interest rates even on unsecured loans, than tenants. This is because almost a third of loans to tenants are never fully repaid. In order to absorb the increased risk, lenders usually charge higher interest rates to non-homeowners even if they have no adverse credit history. Back to Library Send Page To a Friend Please note that the facts and opinions expressed on this website are presented for informational purposes only, and do not constitute a recommendation, instruction or incitement. In particular you must not abuse this information by making untruthful or fraudulent applications for credit or financial services.