What Are Unsecured Loans?

A short-term loan is also often an ‘unsecured’ loan – but what does this mean? Read our explanation below to understand the term, and why an unsecured loan could be a great option if you’re considering borrowing money.

No Risk to Your Assets

An unsecured loan means you don’t have to use any assets to secure the loan.

Traditionally, when borrowing, you need to prove to the lender that you have collateral which they can seize if you can’t repay the debt. This would usually be in the form of property or valuables such as vehicle or business assets. 

For example, a mortgage is a common type of secured loan where the collateral is the property (both house and land) and the lender has the right to repossess it if repayments are not made. Arranging an unsecured loan means there is no risk to your assets if any change in your circumstances leads to difficulty keeping up with repayments.

No Doubt You Can Afford It

Rather than securing a loan against assets, an ‘unsecured’ loan is agreed on the basis that the lender is sure you’ll able to be pay it back. This is done by assessing your income, whether this is in the form of salary, commissions or welfare payments and only granting a loan of an amount you’ll be able to afford. This may be ideal because it means you won’t have to worry about unmanageable repayments from a loan too large for your financial situation.

Quick and Easy Process

Because these loans don’t require any assessment or valuation of assets they are very quick to process. In order to apply you’ll just need to fill out a form and provide proof of your identity and income, and the loan can be approved in a matter of hours.

If you need to borrow money, chances are you want it soon and by choosing to avoid the asset security process, you can save yourself days or weeks of waiting.

If you’re interested in an unsecured loan from Chequers Finance then call us now on 09 299 7883 or visit our website for more ways to get in touch.

A short-term loan is also often an ‘unsecured’ loan – but what does this mean? Read our explanation below to understand the term, and why an unsecured loan could be a great option if you’re considering borrowing money.

Visit us at any of our branches:

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Chequers Finance Hamilton

Caro House
137 Alexandra Street
Hamilton
Phone: 07 838 2939

Chequers Finance Henderson

334 Great North Road
Henderson
Auckland
Phone: 09 836 6201

Chequers Finance Papakura

155 Great South Road
Papakura
Auckland
Phone: 09 299 7883

Chequers Finance Otahuhu

13 Criterion Street
Otahuhu
Auckland
Ph: (09) 276 4384