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A personal loan is a broad term for a loan and it can either be secured or unsecured depending on your personal circumstances and preferences. An unsecured personal loan is often used for debt consolidation, taking a vacation, or purchasing a new car. When applying for a personal loan the lender assesses the borrower's income, current debt and credit history.

A personal loan is different from a secured loan in that the amount is not backed by a form of collateral. Generally, the borrower can take out a personal loan for up to *25,000 for a period ranging from six months to ten years. Typically, the more you borrow the lower the interest rate

How can you use a personal loan?

ou can use a personal loan to take a much dreamed about vacation or to purchase a new car, or used to help payoff credit card debts or aid in debt consolidation. Whatever you use the money for there are many benefits of applying for a personal loan. You can choose an amount from *1,000 to *25,000 and spread the payments over a period of one to seven years. You can even choose a fixed rate for the term of the loan, which makes it easier to plan. If you want to repay your loan early, look closely at any penalties that the lender may charge.

Research all loan offers before your final decision

It is important to gather as much information on all the potential lenders you have applied with so that you make an informed decision. If you already have a lender, it is important to compare their offer with other lenders. It is also crucial to answer all of the questions on the applications. Doing so will decrease the chance of any errors occurring that may impact whether your personal loan application is accepted. In addition, if there are errors on your application this can slow down the amount of time it takes to approve your personal loan application. When you are researching lenders, do not forget to look online for personal loan offers as well. Quite often, they can be very competitive with those you find locally.

What is personal loan protection?

t is wise to consider taking some form of protection out on your personal loan. If an unforeseen accident occurred, rending you unable to make the scheduled repayments personal loan protection will cover your payments for the allotted period. Loan protection is available to anyone over the age of 18 who is working more than 16 hours per week. There are also options when you sign up for loan protection, that provide life cover up to a maximum of *50,000 so that in the unfortunate event of your death your loan would be paid in full.

If you lose your job during the term of the loan and have loan protection your payments are covered if you have been in continuous employment for at least six months from the time, you took out the loan and have had the loan for thirty days or more.