There are several types of loans, including personal loans, auto loans, mortgage loans and students loans. they differ in terms of their purpose, interest rates, repayment terms, and whether they are secured (backed by collateral) or unsecured (based on your creditworthiness).
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A secured loan requires collateral, such as a car or home, to back the loan. An unsecured loan does not require collateral but relies on your creditworthiness. The choice between them depends on your financial situation and willingness to risk collateral. secured loans often have lower interest rates but carry the risk of losing the collateral if you default.
The loan application process typically involves filling out an application form, providing personal and financial information, and submitting supporting documents like pay stubs, tax returns and bank statements. Lenders review your application, credit history, and documents to determine your eligibility and prove or deny the loan.