Require that you back your loan with something you own that’s valuable, like your home or car. These items, known as collateral, can be taken by the lender to satisfy the loan if the borrower defaults on repayment.
Have longer repayment terms and, because they are secured by items of value that reduce the lenders’ risk, often carry lower interest rates.
May carry fixed or variable repayment terms, depending on the type of loan.
May be tax deductible, if secured by your primary residence.
Unsecured Loans:
Are also known as signature loans or personal loans.
Are given based on your personal credit history, as often measured by your “FICO” (credit rating agency) score.
Are generally shorter in duration with fixed interest rates and repayment amounts.
Can often be processed quickly; in a matter or minutes or hours, with a minimum of paperwork.
Require no home equity or other collateral.
Pools are typically financed through a long-term mortgage similar to the one used to purchase your home. Banks and other financial lenders will often look favorably upon swimming pool financing because they see it as home improvement.
