Most personal loans are unsecured loans, meaning loan approval is based on your credit score and history. In cases where you are unable to qualify for an unsecured personal loan, getting a secured personal may be an option. Secured personal loans are generally an alternative to an unsecured loan, but what are the best secured personal loans of 2024?
If you are having a hard time qualifying for an unsecured personal loan due to a poor credit history and you need a loan with lower rates, getting a secured personal loan could be a good option.
Secured personal loans require collateral from borrowers to take a loan. These assets may include vehicles, homes, or financial assets. If you ever default on the loan, your lender may acquire your property, sell it, and use the money to pay off the loan.
Best Secured Personal Loan Lenders of 2024
Secured personal loans can be quite hard to select from, especially when finding the one best for your situation. When searching for the best secured personal loans, you need to consider the loan best for you based on interest rates, fees, and loan terms. Some of the best-secured personal loans of 2024 include:
1. Upgrade
Upgrade is one of the best lending platforms that offers secured personal loans to borrowers with poor credit scores. It requires borrowers to use their cars as collateral or even get a co-signer if they are unable to get an unsecured loan.
It offers loans ranging from $1,000 to $50,000. Within a business day after approval, your funds will be deposited directly into your account. However, Upgrade charges an origination fee of up to 9.99% of the loan amount taken. In return, it offers $200 if borrowers create an Upgrade Reward Checking Plus with a minimum deposit of $1,000.
2. OneMainFinancial
If you are looking for a secured personal loan that accepts a large range of collateral, OneMainFinancial is a good option to consider. This lender allows collateral like automobiles, campers, motorcycles, trucks, boats, RVs, and so on. In cases where other lenders reuse to approve you for a loan, this lender is a good option to consider.
This lender ensures that borrowers’ credit scores stay the same while checking their offers. However, instead of in person, you can apply for a secured loan with this lender online. Through their online platform, you can apply for buying or refinancing a car, moving, car repairs, debt consolidation, home improvement, weddings, pools, and so on.
3. Best Egg
If you are a homeowner, you can get a secured personal loan at Best Egg. This lender offers secured loans to homeowners to fix up their homes.
Borrowers can use things like cabinets, bathroom vanities, and shelving as collateral to get a larger loan amount along with good rates without having to put their homes at risk. However, do not forget that Best Egg can remove these things from your home legally to pay off your loan if ever you default on the loan.
4. First Tech
First Tech Federal Credit Unions render a long list of secured personal loan options with higher maximum loan limits borrowers can select from.
This lender requires borrowers to secure their loans with stock, a savings account, or certificates of deposit (CD) to get different loan terms, values, and APRs. Using these secured loans, you can pay for medical expenses, taxes, vacations, or to fund tech projects. This lender has no origination or annual fees and no application.
5. Patelco Credit Union
Patelco Credit Union offers secured personal loans backed up by CDs and savings accounts. Savings-secured loans allow borrowers to borrow up to the complete amount in their savings account for up to 60 months, along with low APRs of 2.50%.
A CD-secured loan allows borrowers to borrow up to the complete amount of their CD until they mature. However, you do not need to be a member of the Patelco Credit Union to check their rates online; your credit score will not be affected by this action.
FAQs
How much can I borrow with a secured personal loan?
The loan amount you can take on a secured loan depends on different factors. These factors include the lender’s loan range, your credit score, your collateral value, and your credit history. You can also prequalify for a secured personal loan or request quotes from online lenders to evaluate loan amounts available for you.
What credit score is required for a secured personal loan?
Every lender has their own credit score requirements, meaning it is different with every lender. You will need to review the eligibility requirements of the lender to see whether they have any credit score requirements or not.
How long does it take to be approved for a secured personal loan?
This also depends on the personal loan lender you intend to work with. Within minutes, most lenders prequalify borrowers and fund them within one to four business days. The time taken for approval depends on whether the lender requires an evaluation or other verification documents, if you encounter any problems, or their communication response times.
What happens if I default on a secured personal loan?
If you default on a secured loan, your lender can legally take possession of your asset placed as collateral and sell it off to pay off the loan you took. In cases where you placed your vehicle as collateral and defaulted on the loan, the lender would sell your car and pay off the loan.
