Credit > Loans > Loan Types > Unsecured

Unsecured Loans

Unlike secured loans, unsecured loans don't use your house, or other property, as equity to secure the loan.

Unsecured loans are usually for lower amounts than secured loans and are paid back over a shorter time, usually up to 7 years.

Unsecured loans are often known as personal loans. They can be used for almost anything from a new kitchen to a holiday, but are probably most commonly used for buying a car.

Things to look for

Probably the most common point of comparison for loans is the APR, or Annual Percentage Rate. This tells you the rate of interest you will pay on the loan - the lower the rate, the less interest you will pay over time.

Other things to look for, though, include any fees associated with the loan. Some may have loan origination fees that you have to pay to take out the loan. Others may have costly penalties if you choose to pay off the loan ahead of schedule.

Flexible Unsecured Loans

Some loans are now offering more flexible features such as the opportunity to take payment breaks or the ability to change the length of the loan.

You might also want to consider payment protection. Most lenders offer this for an additional monthly charge. It is a kind of insurance that covers your payments in the event of an accident, illness or unemployment. Be sure to read the full details of such a policy before deciding to take one out.

Unsecured Loans Compared

	Interest Rate	Repayment Term	Loan Amount	Application
Cahoot Fixed Rate Loan	Typical 5.8% APR	2 to 7 years	£5,000 to £20,000	Details
Cahoot Flexible Loan	Typical 6.9% APR	Flexible	Up to £20,000	Details
Special Features: The Cahoot flexible loan allows you to make payments when you want for how much you want. You can also borrow more money when you need, up to your loan limit.
24 Hour Loans	Typical 10.9% APR Variable	Varies by Lender	Varies by Lender	Details
24 Hour Loans compares a wide number of available loans to get you the best quote possible.
Alliance & Leicester	Typical 5.9% APR	1 to 5 Years	£5,000 to £15,000	Details