Before applying for a loan from licensed moneylenders or traditional financial institutions, you’ll probably be faced with the choice of a secured or unsecured loan. What exactly does a secured loan and an unsecured loan mean? Secured vs Unsecured Loans Explained In general, loans are broadly divided into two groups: secured loans and unsecured loans. The type of loan that you choose to take will depend on your needs and the availability of collateral. A secured loan is one where you will be required to provide an asset as security for the loan amount. In case of default, the lender has the liberty to sell your asset to recover the debt. At Lending Bee, you’ll be glad to know that we offer secured loans up to $2,000,000. Some of these include private property purchase loan, or an auto loan. An unsecured loan is one where there is no collateral needed for you to get the loan. In this case, the loan is issued on the strength of your credit rather than on the value of an asset. Lending Bee offers a wide variety of unsecured personal loans to suit your everyday needs. The table below shows the comparison between secured and unsecured loans in Singapore. Secured Loans Unsecured Loans Collateral is required No collateral is required Lower rate of interest because of the lower risk for the lender Higher rate of interest because of the higher risk for the lender Risk to the borrower of losing an asset No risk to the borrower of losing an asset Higher loan amount Lower loan amount Longer loan term Shorter loan term Types Of Secured Loans Singapore The type of loan that you choose to take will depend on the purpose of the loan. The following are some types of secured loans in Singapore and what they can be used for: 1. Car Loan This is a loan that is secured by the car that you plan to purchase. In most cases, car loans are used to purchase brand new cars. Once you take out a car loan, the use of the funds
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