Step 3 Secured or Unsecured. Depending on the credit score the lender may ask if collateral is needed to approve the loan. Secured Loan For individuals with lower credit scores, usually less than 700. The term secured means the borrower must put up collateral, such as a home or a car, in case the loan is not repaid. Therefore, the lender is guaranteed to obtain an asset of the borrower in the event they are paid-back.
Unsecured Loan For individuals with higher credit scores, 700 and above. Does not require the borrower to provide collateral. Step 4 Sign the Agreement.
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