Secured Personal Loans

Understanding factors like credit score and history, income requirements, debt-to-income ratio, collateral, and origination fees is critical to navigating secured personal loans.
secured personal loans
Secured Personal Loans
If managed responsibly, secured personal loans can positively impact borrowers’ credit scores. Read on to know more.
In this article

In personal finance, individuals often seek solutions to fulfill financial needs or undertake substantial investments. Secured personal loans stand out as a viable option, providing borrowers access to funds while leveraging assets as collateral. This blog explores the intricacies of secured personal loans, delving into the best providers, the application process, advantages, disadvantages, and essential considerations for potential applicants.

Best Secured Personal Loans

Discovering the finest secured personal loans involves evaluating lenders’ terms, interest rates, and borrower requirements. Lenders like Beem, LightStream, Best Egg, Upgrade, One Main Financial, and Avant offer competitive rates, flexible terms, and accessible borrowing options, catering to diverse financial needs while prioritizing borrower satisfaction.


Beem simplifies the loan acquisition process by offering personalized rates tailored to individual needs. Users enter their details from $500 to $100,000, enabling Beem to fetch offers from top providers quickly. Our streamlined form allows for quick comparisons, ensuring the right match for each borrower’s requirements. 

From understanding loan types to evaluating finances, comparing offers, and managing repayments, Beem guides applicants through each step seamlessly. By focusing on accuracy and personalized service, Beem empowers users to make informed decisions without delay, creating a hassle-free experience securing funds for various financial needs.


LightStream is an online lending institution focusing on borrowers with good to excellent credit, offering personal loans ranging from $5,000 to $100,000. As part of Truist Bank, it prioritizes providing efficient service to creditworthy individuals, facilitating same-day fund disbursement. Unlike many lenders, LightStream refrains from charging fees, including prepayment penalties or origination fees, while offering a 0.50% APR discount for enrolling in automatic payments before loan funding. 

With a broad spectrum of repayment terms (24 to 144 months) and substantial loan amounts, LightStream caters to varying financial needs. However, it necessitates good credit and doesn’t allow prequalification, making direct application mandatory for rate assessment.

Best Egg

Best Egg, a Marlette Holdings, Inc. subsidiary, stands out as an online lending platform offering prequalification for loans ranging from $2,000 to $50,000. With a focus on quick funding, borrowers typically receive their funds within one to three business days after signing the loan agreement, with a majority getting funded within one day. Notably, Best Egg provides options for secured and unsecured loans, granting flexibility to applicants.

However, borrowers should consider the fee structure: Best Egg charges an origination fee spanning from 0.99% to 8.99%, potentially reaching a minimum of 4.99% for loan terms extending four years or more. Meeting the lowest APR necessitates an annual income of $100,000 and a minimum credit score of 700, posing challenges for some applicants.

Best Egg’s strength lies in its direct payment feature, aiding debt consolidation. Still, it targets applicants with solid credit histories and higher incomes. Pros encompass swift funding, adaptable loan amounts, no prepayment penalties, and the choice between secured or unsecured loans. However, drawbacks include a high maximum APR of 35.99%, origination fees, the absence of autopay discounts, and demanding income criteria for better rates. Potential borrowers must thoroughly evaluate these aspects against their financial circumstances before choosing Best Egg.


Upgrade, functioning as a lending platform, extends personal loans from $1,000 to $50,000 through its lending partners. The platform excels in prompt fund disbursement, delivering loan amounts within a single business day upon the borrower’s agreement signature. An advantageous feature is the interest rate discount accessible to Upgrade customers opting for autopay and utilizing loan funds for direct debt settlement. 

With a modest minimum credit score requirement of 580, Upgrade accommodates borrowers with lower credit scores. However, it’s important to note the relatively high origination fee, ranging from 1.85% to 9.99%, which could impact the total loan amount disbursed. 

By offering joint applications and flexible repayment terms spanning 24 to 84 months, Upgrade is well-suited for individuals seeking to consolidate high-interest debts like payday loans, providing opportunities for lower rates and direct payment to previous creditors. 

Despite its benefits, borrowers should consider the origination fee, maximum APR of 35.99%, and potential late fees when opting for Upgrade loans.

OneMain Financial

OneMain Financial, a lending institution operating across 44 states, specializes in fixed-rate personal loans ranging from 18.00% to 35.99%. Unlike many online lenders, it offers in-person service through its branch network, appealing to borrowers seeking face-to-face interactions during the loan process. Providing secured and unsecured loans, OneMain Financial accommodates low-credit individuals by offering secured options for lower interest rates.

Despite its quick funding timeline, typically within one business day, and the flexibility to change payment due dates, this lender stands out for its high interest rates compared to competitors. OneMain Financial’s maximum loan amount is $20,000, making it more suitable for those seeking smaller loan sums.

While borrowers with good credit might find more competitive rates elsewhere, OneMain Financial caters to individuals with lower credit scores, potentially easing qualification. However, its origination fees ranging from 1.00% to 10.00%, high interest rates, and limited loan amounts might not align with the preferences of borrowers seeking more considerable sums or more competitive rates based on creditworthiness. Ultimately, its focus on offering a local, personal lending experience and catering to individuals with lower credit scores distinguishes OneMain Financial in the lending landscape.


Avant, an online lending platform, extends unsecured personal loans suitable for emergencies, debt consolidation, and home improvements. With a minimum credit score requirement of 580, Avant accommodates borrowers with lower credit ratings. However, terms may vary based on overall creditworthiness. 

While offering flexible loan durations ranging from 12 to 60 months, Avant’s longest loan term spans 60 months, allowing more extended repayment for more significant amounts. However, borrowers should note the potential origination fee, deducting up to 4.75% from the loan principal. 

One of Avant’s distinguishing features is its prequalification process, enabling applicants to view conditional loan terms, interest rates, and potential funding amounts without undergoing a hard credit inquiry. This aspect makes Avant an appealing choice for borrowers keen on shopping for competitive rates while considering their financial situations and credit histories.

Despite these advantages, Avant’s potential maximum APR of 35.95% and origination fees for specific borrowers might dissuade some applicants. Moreover, Avant’s loan availability is not nationwide, limiting access for potential borrowers in certain areas. Overall, Avant provides an accessible platform for borrowers with lower credit scores seeking personalized loan terms and smaller, shorter-duration loans, emphasizing flexibility and convenience in the lending process.

Understanding Secured Personal Loans

Understanding secured personal loans involves comprehending the distinction between secured and unsecured loans. Unsecured loans rely solely on creditworthiness without collateral. In contrast, secured loans necessitate assets, like a vehicle or savings, as security against borrowed funds. These loans, offered by diverse lenders, encompass amounts from $1,000 to $50,000, APRs between 6% to 36%, and repayment terms from one to seven years. Loan approval considers collateral valuation, credit, income, and debt. 

Timely repayments uphold collateral ownership; however, defaulting permits the lender to seize and sell the collateral to recover the outstanding loan amount, as seen in mortgage or car loans. Failure to repay can lead to foreclosure or asset repossession.

What Are the Things to Know Before Applying for a Secured Personal Loan?

Before applying for a secured personal loan, understanding key factors is essential:

  1. Credit Score and History: Lenders assess credit scores (ranging from 300 to 850) based on payment history, debt, and credit length. Many require a minimum score of around 600, although some lend to those without a credit history.
  2. Income Requirements: Lenders stipulate minimum income levels; for instance, SoFi requires $45,000 yearly, while Avant’s minimum is $20,000. Evidence includes tax returns, bank statements, pay stubs, or self-employed proof.
  3. Debt-to-Income Ratio (DTI): Calculated as a percentage, DTI reflects the portion of monthly income used for debt payments. An ideal DTI is below 36%, but some lenders accept up to 50% for highly qualified applicants.
  4. Collateral: Secured loans demand valuable assets as collateral related to the loan’s purpose or other valuable holdings like cash accounts, real estate, or collectibles. Default could lead to repossession by the lender.
  5. Origination Fee: Although not part of the qualification process, many lenders charge origination fees, typically 1% to 8% of the loan amount, covering application processing and credit checks.

Application Process for Secured Personal Loan

Follow these steps to apply for a secured personal loan.

  1. Prequalification: Complete an application with personal and financial particulars to ascertain eligibility for the secured personal loan based on initial criteria set by the lender.
  2. Submission of Collateral Information: Furnish details regarding the proposed collateral for securing the loan.
  3. Verification and Underwriting: The lender reviews the application, verifies the provided information, assesses risk, and conducts underwriting to evaluate the borrower’s eligibility and the loan’s feasibility.
  4. Approval and Fund Disbursement: Once approved, the finalized loan terms are determined, and upon agreement, the funds are disbursed to the borrower to initiate the loan.

Advantages of Getting a Secured Personal Loan

There are many advantages to availing a secured personal loan.

  1. Lower Interest Rates: Secured loans generally boast lower interest rates due to the collateral offered, making them a cost-effective borrowing option compared to unsecured loans, saving borrowers money over time.
  2. Higher Loan Amounts: Using collateral enables access to more considerable loan sums, facilitating substantial financial endeavors or addressing major expenses, providing greater financial flexibility and support.
  3. Improved Approval Odds: Lenders are more inclined to approve secured loans due to reduced risk, making them accessible to individuals with lower credit scores or limited credit history.
  4. Potential Credit Improvement: Timely repayments on a secured loan contribute positively to credit profiles, showcasing responsible financial behavior and potentially enhancing credit scores over time.
  5. Flexible Repayment Terms: Secured personal loans often offer extended repayment periods, providing borrowers with manageable monthly payments and greater flexibility in budgeting and financial planning.

Disadvantages of Getting a Secured Personal Loan

A couple of disadvantages could affect you if you opt for a secured personal loan.

  1. Risk of Asset Loss: In case of default, the lender has the right to seize and sell the collateral, potentially resulting in the loss of the pledged asset and impacting the borrower significantly.
  2. Higher Risk for Borrowers: If unable to repay, borrowers face more significant consequences, including potential damage to credit scores and financial stability due to collateral forfeiture.
  3. Limited Options for Collateral: Only some have valuable assets to pledge as collateral, restricting access to secured loans and potentially limiting borrowing options for specific individuals.
  4. Interest Rate Fluctuations: Some secured loans may carry variable interest rates, subjecting borrowers to potential payment fluctuations impacting long-term financial planning and stability.
  5. Overborrowing Risks: Access to more significant loan amounts might tempt borrowers to overextend financially, leading to potential debt issues if they need help managing repayments effectively.


Secured personal loans present an attractive avenue for accessing significant funds on favorable terms. Yet, potential applicants must conduct meticulous research, comprehend the loan’s implications, and evaluate their financial capabilities before opting for such financing. Careful consideration ensures informed decisions and aligns borrowing with individual financial goals and capacities.

If you need more clarification about the process, consult a tax professional or seek free assistance like Beem provides online.


How hard is it to get a secured personal loan?

Securing a loan depends on factors such as creditworthiness, collateral, and the lender’s criteria. While eligibility requirements vary, having a steady income and suitable collateral increases the chances of approval.

Does a secured loan hurt your credit?

If managed responsibly, a secured loan can positively impact credit scores. However, defaulting on payments can adversely affect credit.

Do I need good credit for a secured loan?

While good credit enhances eligibility and can result in better terms, some lenders offer secured loans to individuals with varying credit profiles.

Can you get denied for a secured loan?

Lenders may deny a secured loan application if the borrower’s financial situation, credit history, or collateral don’t meet their requirements.

Do banks prefer secured loans?

Banks may favor secured loans due to reduced risk. However, preferences vary among lenders based on their policies and customer profiles.

Was this helpful?

Did you like the post or would you like to give some feedback? Let us know your opinion by clicking one of the buttons below!



Picture of Raman Gujral

Raman Gujral

An achievement-oriented professional, Raman has 10+ years of experience in B2B SaaS and B2C products across Fintech, Telecom, Digital Media, Social Media and Logistics domains. Defining and communicating product vision and strategy, product roadmap development, product positioning, and data analysis, he is also an expert in health insurance and personal loans content.


This page is purely informational. Beem does not provide financial, legal or accounting advice. This article has been prepared for informational purposes only. It is not intended to provide financial, legal or accounting advice and should not be relied on for the same. Please consult your own financial, legal and accounting advisors before engaging in any transactions.

Related Posts

Can you Buy a Car with a Permit?
Can you Buy a Car with a Permit?
Can you purchase a car with just a learner's permit? While it is feasible to work out a bargain, registering the car in your name may provide difficulties. A driver's license is necessary to complete the purchase and registration. Let's plunge in!
Loans Like eLoanWarehouse
Payday Loans eloanWarehouse & It’s Alternatives [2024]
There is a range of options from established banks like Wells Fargo and Bank of America to new platforms like CashNetUSA and Beem, each with accelerated financing and changing qualifying requirements to meet your specific needs. Let us learn about these alternatives.
8 Payday Loans That Accept Chime
While Chime isn't a traditional bank, it offers similar features and sometimes more. As a result, lenders trust Chime enough to give payday loans on this platform. Let's look at them.
How Can You Reduce Your Total Loan Cost?
Can I Get A Payday Loan While In Chapter 13?
Payday loans are great when looking for quick access to funds. However, they come with considerable interest rates and negative outcomes. In most cases, you may not even get payday loans due to low credit scores and Chapter 13 Bankruptcy records. 
How Do I Get a Cash Advance from Albert?
How to Get a Cash Advance from Albert?
In this article, learn how to get a cash advance from Albert. Explore the process, insights, tips, and guidance to help you with any query regarding this financial option. Continue reading!

Get up to $1,000 for emergencies

Send money to anyone in the US

Ger personalized financial insights

Monitor and grow credit score

Save up to 40% on car insurance

Get up to $1,000 for loss of income

Insure up to $1 Million

Coming Soon

File federal and state taxes at low cost

Quick estimate of your tax returns

Get up to $1,000 for emergencies

Send money to anyone in the US

Save big on auto insurance - compare quotes now!

Zip Code:
Zip Code: