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Secured & Unsecured Loans
What Every Business Owner Should Know about secured and unsecured loans
When you’re exploring funding for your business, you’ll quickly come across two main types of loans: secured and unsecured. On the surface, they sound like simple labels, but the difference between the two can have a huge impact on your interest rates, repayment terms, and even the risk to your personal assets.
Let’s break them down in plain language.
What is a Secured Loan?
A secured loan is backed by collateral. That means you pledge an asset—like your house, car, business equipment, or even savings—as security for the loan. If you don’t pay the loan back, the lender has the legal right to claim the asset.
Examples of secured loans include:
Mortgages
Car loans
Business equipment loans
Because the lender has some protection, secured loans usually come with:
Lower interest rates (less risk to the lender)
Higher borrowing limits (you can often access larger sums)
Easier approval if you have collateral, even with a less-than-perfect credit score
But the tradeoff is clear: if you default, you could lose what you put up as collateral.
What is an Unsecured Loan?
An unsecured loan doesn’t require any collateral. Approval is based mostly on your credit score, credit history, and income. The lender takes on more risk, so they protect themselves in other ways.
Examples of unsecured loans include:
Credit cards
Personal loans
Some business lines of credit
Since the lender has no asset to fall back on, unsecured loans usually come with:
Higher interest rates
Smaller borrowing amounts
Stricter approval requirements (you’ll need strong credit and steady income)
While you won’t risk losing your house or equipment, defaulting can still damage your credit score and may lead to collection actions or lawsuits.
| Feature | Secured Loan | Unsecured Loan |
|---|---|---|
| Collateral | Required | Not required |
| Interest Rates | Usually lower | Usually higher |
| Borrowing Limits | Higher | Lower |
| Approval | May be easier with collateral | Stricter, credit-based |
| Risk if You Default | Lose pledged asset | Credit damage, collections/lawsuits |
| Common Examples | Mortgage, auto, equipment loans | Credit cards, personal loans, some LOCs |
| Best For | Larger amounts, lower rates, willing to pledge assets | Smaller amounts, no collateral, strong credit |
Explore your loan options
Home Improvement Loans
Funding Without Draining Your Savings
Upgrade your home without draining your savings. Our home improvement loans give you the flexibility to fund your projects without overthinking.
Flexible Options for Every Project
We offer secured loans for larger renovations that may require collateral, and unsecured loans for smaller projects or quick upgrades. You choose the option that fits your project size and budget.
Debt Consolidation Loans
Simplify Your Finances with One Payment
Combining multiple debts into a single monthly payment makes budgeting easier and reduces the stress of juggling several creditors.
Lower Interest, Faster Relief
Many of our borrowers save money on interest by consolidating high-interest debts into a single loan. Our secured and unsecured options give you the flexibility to choose the best path for your financial situation.
We offer one clear payment, transparent terms, and the guidance of our loan specialists, you can pay down debt faster and start building a more secure financial future.
Personal Loans
Flexible Funding for Life’s Unexpected Moments
Life doesn’t always go as planned. Our personal loans provide flexible funding for unexpected such as medical bills, emergency repairs, owed taxes, or other large purchases.
Choose the Right Loan for You
Our personal loans are designed to provide clarity, flexibility, and peace of mind. We are all about helping you understand your options, avoid hidden fees, and select repayment plans that fit your budget.
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Choose secured or unsecured options based on your needs, and enjoy fast approvals, transparent terms, and repayment plans that fit your budget.