Consumer loans have been around for many years, and each loan that is offered has its own perks and drawbacks. A consumer loan can be an unsecured loan or a secured loan. An unsecured loan means that there is no collateral required for loan approval. A secured loan means that some valuable item must be used as collateral to achieve the loan. There are two main distinctions between the two loans. The unsecured loans usually have higher interest rates, but the worst thing that can happen if you default on the loan is a reduced credit score. A secured loan comes with a lower interest rate, but if you default on that loan the item that you used for collateral can be lost to the loan company. There are many options available, so take the time to find the best one for your situation.

The more common consumer loans are personal loans, consolidation loans or home equity loans. Personal loans can usually be taken out for very small amounts, and most people will be able to extend that amount to at least $15,000. Some banks are willing to offer even more money based upon your credit worthiness.

Consolidation loans are really becoming more popular each year as consumers continue to struggle paying off their debt. A consolidation loan can be used to pay off any unsecured debts that you may have. Once you are approved for the loan, you simply pay off the creditors. This is a great way to reduce the number of payments you have each month and possibly have a lower credit score.

Consumers have found that home equity loans are another form of consumer loans with a low rate monthly rate. There may be some stipulations regarding the loan, but remember that this is money that is drawn against your home. It is essential to repay it as required by the terms of the agreement.