There are two types of personal loans — u003ca href=u0022https://www.creditkarma.com/personal-loans/i/unsecured-personal-loanu0022 target=u0022_blanku0022 rel=u0022noreferrer noopeneru0022u003esecured and unsecuredu003c/au003e. Unsecured personal loans aren’t backed by collateral. The lender decides whether you qualify based on your financial history. If you don’t qualify for an unsecured loan or want a lower interest rate, some lenders also offer secured loans. Secured personal loans are backed by collateral, such as a savings account or CD. If you’re unable to make your payments, your lender typically has the right to claim your asset as payment for the loan.