Secured vs. unsecured loans: how do they differ and which is better?

The big difference between a secured loan and an unsecured loan comes down to one thing: collateral. This refers to a valuable possession, such as a house or a car, that backs up — or secures — the loan, as the lender can take that asset should you fail to repay the money you have borrowed.

While a secured loan may sound scary, and there is certainly risk involved, there are upsides to this kind of loan as compared to an unsecured loan, where you do not put anything on the line. Keep reading...