I want to apply for an unsecured loan. Anything I should know beforehand?

I require funds for my business and I am thinking of applying for an unsecured loan.

  • If you want to go for an unsecured loan, you should know about the advantages and disadvantages for the same.
  • Unsecured loans do not include any security and therefore the lender cannot seize any asset if you default on a loan.
  • An unsecured loan can be taken when there is a quick need for funds or when there is unfavorable cash flow.
  • The rate of loan disbursal is also faster in case of an unsecured loan since the whole process is online.
  • Even though the lender cannot seize the assets, you can be sued in court which will have a negative impact on your credit score.

So before you go ahead with the application, weigh the pros and cons thoroughly and then decide based on your requirements.