When it comes to getting a UK personal loan you have two choices. You can choose to get an unsecured loan or you can choose to get a secured loan.

An unsecured loan is simply a loan you get based on your good name and your credit rating. Often the interest rates are low the higher on an unsecured loan and on a secured loan because the risk is higher to the lending institution. If, for some reason, you are unable to pay back the loan and the lending institution does not get any money back. However, your good name and your credit rating are potentially ruined.

On the other hand, a secured load is a low you get when you put up some assets. The advantage of a secured loan is that you often get more money at a lower interest rate for longer repayment period that you would with an unsecured loan. This is because you have some assets to backup your loan. The lending institution prefers this kind of loan because if you find yourself unable to make payments, they can see your assets as an alternative form of payment. Because the risk to them is diminished they are able to provide you with more attractive loans at a better rate.

You might think of a mortgage as a secured loan. The bank lends you money to buy a house and they use the house as a way to back up the loan. If you do not make your mortgage payments, the bank can seize your home.

Or you can think of a secured loan as a pawn shop that lends you the money you want but lets you still use the goods you pawned!

So which one is the right one for you? It's a tough decision to make. In most cases, a secured loan will get you a better rate, so you may prefer that.

However, perhaps you don't have any assets available, or you don't want to risk the seizure of certain assets if you are unable to make payments. In this case, you may not mind paying a little more for the benefit of having an unsecured loan.

Both unsecured and secured loans are good options to have when you are doing your financial planning. You can use them to consolidate your outstanding bills, leverage your house investments, or get the things you need and want. And, with the choices between unsecured and secured loans, you have the benefit of being in total control of your financial destiny!