Personal Bad Credit Loans Help

Question by Sean S: how do secured vs unsecured loans affect your credit?
My wife and I are looking to buy a house in the next year and to prepare for that, we want to downgrade our car. With what we want to put down on the new car and wanting to finance only 3k-5k of the car, our bank doesn’t do auto loans for that little, but they will give us a personal loan.

How does a personal(unsecured) loan affect your credit vs a secured (auto loan)?

Best answer:

Answer by Bob
Unsecured loans have higher interest rates than secured loans. The higher payment from the unsecured loan will increase the debt to income ratio and possibly result in a higher interest rate.

What do you think? Answer below!

Due to Government changes in the Consumer Credit Act 1974, there are now ways to legally clear your credit card and unsecured loan debt. Please visit the Debtmuncher website for a radio 4 interview, BBC news clip and to contact us.

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