Unsecured Loans: a Boon for Society!

By: Adam Jaylin

There can be no denying the fact that life has become very expensive these days. There is not a single item which can be bought without thinking carefully about it. In this scenario loans become the lifeline of every middle class family. Expenses, especially such expenses which crop their head all of a sudden is taken care of by loans provided by the banks.

Loans can further be classified into secured and unsecured loans. Loans which can be obtained without placing any security against it are the unsecured loans. This loan, rather this type of loan can be obtained by anyone, people who have their own homes or people who don't have theirs. Since no security is required there is very little documentation done and processing of loan is fast.

Unsecured loans can prove to be beneficial in a number of ways. The first major utility of unsecured loan is that of consolidation of debts, secondly it can be used for buying important articles for home, for clearing bills or for paying college fees, it can also be used for purchasing a vehicle or for starting up a new venture.

However, since no security is involved there are certain parameters on which a borrower is judged before loan is sanctioned to him. First of which is that he should be a regular employee and should have a regular monthly income, then he should be above the age of 18 years and should be able to furnish his residential proof. Another great thing about is that people with bad credit history can also apply for it.

The amount of loan can range anywhere between ?1000 - ?25000 and the repayment can take anywhere between 6 months to 10 years. Interest charged is deliberately kept high so that people think deeply before going for such loans.

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