Installment loans can be either secured or unsecured. A secured loan simply uses a form of personal property like a paid-off vehicle or home equity to ensure the borrower doesn’t default on the loan. An unsecured loan doesn’t require collateral. If the borrower does default, the lender may then seize the collateral to pay off the remaining balance of the loan. Auto loans and mortgages are secured loans, while student loans and some personal loans are unsecured.