Unsecured loans are monetary loans that are not secured against the borrowers assets. These may be available from financial institutions under many different guises or marketing packages:



* credit card debt

* personal loans

* bank overdrafts

* credit facilities or lines of credit

* corporate bonds

The interest rates applicable to these different forms may vary depending on the lender and the borrower. These may or may not be regulated by law. In the United Kingdom, when applied to individuals, these may come under the Consumer Credit Act 1974.

Unsecured Loans or Personal Loans are loans that are not secured on anything and are assessed purely on your income and track record of making payments. They are very quick to arrange however are only available up to ?25,000 over a short period, usually a maximum of 5-10 years, because the lender has no security for offering the loan the rates are often higher than a secured loan, however there are very competitive deals out there and it is always best to see what deals your own bank can offer you first.

Useful for consolidating smaller but more expensive debts, or when buying a holiday, having a new kitchen or bathroom or that new car you've always wanted. If you are home owner and considering a personal loan it is always a good idea to get a secured loan quote too to compare which would be best for you.

Depending on your circumstances there are a huge amount of competitive personal loan deals available on the market. It is always adviseable to search for personal loans over the internet as with technology moving on so fast lenders are cutting cost by allowing you to apply for a personal loan online, and can therefore offer more competitive deals than you would find on the high street.

Always remember though, when considering a personal loan, you should always make sure that you have enough disposable income to maintain the loan payments for the term of the loan. The easiest way to do this is to budget; write all of your income and outgoings a sheet of paper, calculate how much disposable cash you have after all outgoings have been taken into account, could you still live comfortably with the loan payments taken off too? Can this be sustained longer term? If the answer is yes then a personal loan could be right for you.

This personal loan article was written by Gary Taylor, a representative of Rate Hunter Limited. The views and opinions expressed in the article are for information purposes only, they do not constitute advicend therefore should not be relied upon as such.

Abuses in lending

Predatory lending is one form of abuse in the granting of loans. It usually involves granting a loan in order to put the borrower in a position that one can gain advantage over him or her. Where the moneylender is not authorised, it could be considered a loan shark.

Usury is a different form of abuse, where the lender charges excessive interest. In different time periods and cultures the acceptable interest rate has varied, from no interest at all to unlimited interest rates. Credit card companies in some countries have been accused by consumer organisations of lending at usurious interest rates and making money out of frivolous "extra charges".