The Flexibility of Collateral Loans

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4th Jul, 2023

Economic instability is a harsh reality of this life that collateral loans can soften. If the interest rates are soaring through the skies, collateral loans come to your rescue. By definition, collateral is any asset a lender accepts in exchange for a loan.

For added convenience, your credit scores barely matter!

In this article, we’ll dive deep into what exactly collateral loans are and how they can help you get the financing you need, regardless of your financial situation.

 

What are Collateral Loans?

Everything comes at a price, but only a fair one. A collateral loan, also called a secured loan, is guaranteed by something you own, the collateral. It helps the lending body gain a sense of security as well. This is because if you are unable to pay back the loan due to any unforeseen situation, the lender will have the right to claim the collateral instead.

Resulting in a mutually beneficial lend.

 

Putting Your Assets to Work: Types of Collateral You Can Leverage for a Loan

Considering the various types of collateral loans, some of them are naturally more popular than others. Below we list the options of assets you can obtain a collateral loan against:

  • Moveable Assets: Cars, motorbikes, boats, commercial vehicles and earthmoving machinery. The lender will take physical possession of the movable asset before the collateral loan is provided.
  • Luxury Items: This might include items like luxury watches, etc.

 

Flexibility & Benefits of Collateral Loans

Here’s a list of the benefits of collateral loans that will help you make a better decision.

1. No Effect on Finances and Credit History

Collateral loans do not rely on your credit history or your finances. So, you never have to worry about collateral loans leaving scars on your finances or credit history. On the contrary, it may even help you build your credit score.

2. Better and Faster than Bank Loans

Unlike banking loans, collateral loans are much simpler and don’t require extensive credit checks either. This automatically makes them faster and easier to access. More so, since the borrower is providing collateral, lenders are more than happy to hasten the process of providing funds with lesser paperwork.

3. Comparatively Lower Interest Rates

Collateral loans have a lower interest rate than unsecured loans. Due to the collateral, the borrower automatically has a decreased risk of default, encouraging the lender to be more generous in the set loan terms.

 

Who can apply for Collateral Loans?

Collateral loans are available for everyone, whether you are an individual or a business. The only prerequisite of applying for a collateral loan is to have collateral.

 

How can Instant Cash help you with collateral loans?

At Instant Cash, we provide collateral loans against your paid-off, moveable assets. We provide individuals and companies with immediate cash through a seamless and easy process. We ensure market-competitive interest rates on trouble-free borrowing terms.

Contact us today for more information and an evaluation of your moveable assets.