Getting a secured personal loan is getting common nowadays as many seek such financial assistance to support their financial obligations or fund their own personal plans such as planning for their wedding, starting a small business or even planning for a vacation. Here are some questions about getting such financial assistance when you have an unsatisfying credit history:

Q. Why is borrowing a secured loan is better than an unsecured one?

A. Basically, you need to bear the high interest rates if you obtain either of the abovementioned loans. You could not really draw a line between these two particular loans when it comes to choosing the ideal financial assistance. The answer can be a "yes", if you are able to put up collateral for your loan application.

There a few advantages of getting a loan which requires collateral - the lender would offer lower interest rate or a lower cost of the actual loan. If your asset is worth more than you actually borrow from non-bank lenders, you can use this opportunity to "bargain" with them so that you'll be able to get good loan deals from them. In other words, you can possibly get a lower interest rate than applying for unsecured loans.

Q. How could I possibly find a reliable financial institution that offers secured loan for people with bad credit history?

A. Most people would know that getting such financial assistance when you have a bad credit score is definitely not from traditional lenders. However, it does not mean that you will easily get such loan with low credit score from non-bank lenders. In fact, both types of lenders require credit check on their loan applicants - and it's no exception for their existing clients. Please be aware of those lenders who claimed that they approve loans without performing any credit check on their applicants - it could be a trick from scam artists.

Therefore, it is a must to seek accredited lenders via Better Business Bureau (BBB). Based on BBB's business directory, you will be able to check out their business in order to make sure that these lenders are operating their loan lending business legally, as well as having a clean business record.

Q. What should I do if the lender does not approve the loan amount that I really want?

A. There are several reasons that a lender does not grant the exact loan amount to their client, which is the total loan amount granted is far lesser than the loan amount that their client applied; one of the reasons is that the market value of the clients' assets (which they use them as collateral) is far lesser than total loan amount that the clients applied.

In that case, the lender (usually non-bank lender) would make an exception on your bad credit history as well as your personal earnings. Hence, they would consider your loan application if you have a co-signer who has his own assets and it is enough to convince such lender to grant you a larger loan amount.

It is necessary that you consider the risks of getting a secured personal loan for people who have bad credit history. Take note that the lender has the right to take away your asset if you are unable to make loan repayments as agreed.