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What is a Personal Loan?

Personal loans are a great option when you need to borrow money, but they’re not for everyone. If you have great credit, you’ll benefit from low-interest rates. If you don’t have great credit, you’ll be facing interest rates higher than those offered by credit card agencies. Don’t let that dissuade you; personal loans are a really great option for many people.

Personal loans are great for almost anyone looking to pay off a personal expense. You can use the money to help pay for your wedding, a vacation, consolidate some debt, or any other major purchase!

However, you will need to be careful when applying for a personal loan. Signing up for a personal loan without fully understanding what you’re getting into is an expensive mistake you don’t want to make! Luckily, we’re here to help.

What are the types of personal loans?

There are two types of personal loans: secured personal loans and unsecured personal loans. Both allow you to borrow money, but each has different conditions that you must meet before you can borrow.

Secured Personal Loans

Secured loans are a great option if you have personal assets such as: equity in your car, home, or savings account that can be used as collateral. Securing your loan will often guarantee lower interest rates, larger loan amounts, and even better terms than unsecured loans. Types of secured personal loans include car title loans.

Unsecured Personal Loans

Unsecured loans are issued and supported only by your creditworthiness. Because unsecured loans are obtained without the support of any collateral, they typically come with higher interest rates and less favorable loan terms.

The Pros and Cons of Personal Loans


  1. Personal loans are multi-purpose. They can be used for any type of expense, without restriction.
  2. You can get a personal loan fast. Sometimes, it’s even possible to get a personal loan within the same day you applied.
  3. Little to no paperwork is required. You won’t need deal with a mountain of paperwork when applying, which makes the application process a breeze.


  1. High-interest rates (without collateral). Unsecured loans are a higher risk for lenders. That’s why these types of loans tend to come with higher interest rates.
  2. You need good credit (without collateral). If you apply for an unsecured loan, you’ll need to have a decent credit score to be approved.

Can I Get a Loan With Bad Credit?

Personal loans for bad credit exist, if you know where to look!

A quick Google search will help you find online personal loans, very easily, but you want to make sure you do your research before signing any paperwork. There are plenty of places that offer these types of loans, so tread with caution. We recommend looking for a reputable company. A great indicator would be their Better Business Bureau (BBB) Rating and any customer testimonials you may be able to find on their website.

Personal Loan Interest Rates

The interest rate typically depends on the type of personal loan. Usually, unsecured personal loan interest rates are much higher than rates for secured loans. However, having a great credit score will make it much easier for you to find a low APR.

So what if you have poor credit? It is possible to get a personal loan with bad credit! However, you’ll need some form of collateral to secure the loan. You can use the equity in your home, in your car, or even in a savings account. Securing your personal loan almost always guarantees a lower interest rate too!

Fixed vs. Variable Interest Rates

Variable interest rate loans are loans in which the interest rate is charged on the outstanding balance fluctuates as the market interest rates change. Essentially, your payments will vary as the interest rates change.

Fixed Interest rates are loans in which the interest rate charged on loans is fixed for the duration of the loan. There will be no change or fluctuation in the interest rate, even if market rates change. This allows your payments to remain the same over time.

Not all lending companies are the same, so make sure to ask what type of interest rate you’ll receive when applying for any loan.

Personal Loan Alternatives

When it comes to borrowing money, you have plenty of options to choose from. That’s why it is extremely important to consider your financial situation before deciding on how to borrow. We’re here to help, and that’s why we came up with these short comparisons to give you a basic understanding of personal loan alternatives:

Credit Card Cash Advances

Credit card cash advances are usually only recommended in emergency situations. If you have a credit card, and you need cash immediately, then maybe getting a cash advance makes sense.

We recommend exhausting all other options before resorting to a cash advance because they are an extremely expensive way to borrow money. Interest rates are high, on average about 6 points higher for this type of loan when compared to other traditional forms of borrowing. Don’t get a cash advance unless you have to because you will end up paying much more in the long run.

Payday Loans

Payday loans have become a common resource for emergency funds. However, it’s important to understand just exactly what you’ll be faced with when borrowing from a payday loan lender.

  1. There are multiple fees and interest payments. If you’re unable to pay off your loan in full, these fees will likely double.
  2. You need to be employed, full-time. If you’re receiving government assistance (unemployment, social security, etc) you won’t qualify.
  3. Payday loans are usually good for small amounts. If you need more than $1,000, you better start re-evaluating your options.

All these hidden fees make payday loans more trouble than they are worth. Personal loans, on the other hand, are faced with less restrictions and fees. They can be financed by your credit or a form of collateral. There are plenty of options for you to choose from.

Auto Pawn Loans

They're similar to vehicle title loans, but with one major exception. When borrowing from a pawn shop, you’re required to leave your property in order to get any money. In this case, that means your car. Here are three reasons why you should avoid auto pawn loans completely:

  1. Giving up your car. You have to leave your car with the pawnbroker until you pay off what you owe. This just flat out isn’t possible for most people.
  2. Interest rates and fees are very high. Interest rates can vary tremendously and can often end up costing you more in the long run. Some pawn shops may even charge you a fee for storing your vehicle.
  3. If you’re unable to pay back your loan, kiss your car goodbye. Pawnbrokers will be able to sell your car if you don’t pay back what you owe within a specified time frame.

Pawning off your vehicle is a big risk, a huge inconvenience, and much more expensive way of borrowing money. If you secure a personal loan using your car, some companies let you keep driving it, as long as you make the regularly scheduled payments!

Important Questions To Ask Your Lender

If you’re ready to take the plunge and sign your loan documents make sure you have answers to these important questions:

Is there a prepayment penalty?

Prepayment penalties are additional fees associated with paying off a loan before its scheduled pay-off date. They are meant to compensate the lender for not realizing the expected interest income. Simply put, if you pay off your loan faster than expected, lenders make less money on your loan. So, these penalties are designed as a way to recover the lost profits in the event that you pays off their loan before the agreed upon date.

What other fees must I pay up front?

Get the full story on the company’s fees! Some lenders may simply “forget” to inform you about application costs, fee’s for obtaining your credit reports, or any extra “processing” fees.

Are there any closing costs?

In some cases, you are required to pay fees for the services provided by the lender. However, lenders are required to provide you with a written estimate of these costs within three days of receiving your loan application. Make sure to ask about the closing costs as soon as you can!

How long will it take to process my loan application?

The application process can vary by lender and by loan type. Make sure to ask how long you’ll be expected to wait before you get your money. If you need money for an emergency, you will want to make sure that the lender will be able to provide you with a loan as soon as you need it.

Contact City Loan Long Beach Today

Even if you don’t have perfect credit, City Loan may be able to help you raise the money you need.

Our car title loans are one of the best secured personal loans in the marketplace, allowing you to get your hands on emergency cash within hours of requesting it.

There’s a reason why we’re so often regarded as the best provider of loans for people with bad credit – even if everyone else has already told you “No”, we may still be able to help.

Our car title loans are fast, easy and convenient, and we can get you the money you want within hours of receiving your completed application.

Even if you have a history of late payments, car repossessions, defaults, or even bankruptcies, City Loan may still be able to help.

Find a City Loan Near You Today!

City Loan is without a doubt the best place for anyone to get a car title loan, but where can you find us?

Our primary office is located in Long Beach, CA, but we have offices all over the United States. The address for our Long Beach location is:

3431 Cherry Ave,
Long Beach, CA 90807

If you’re not local to the California area, check out our locations in, Texas,  South CarolinaUtahMissouriCalifornia,  New Mexico, and Arizona. We’re ready to help you today!

Trust us when we say that City Loan is the best place to get a car title loan. Our loan officers will take the time to work with you to find the best plan that fits your needs. No other car title loan provider compares. That’s why you should get in touch with us today!

To get the money you want, please fill out our online application form, or give us a call at 1-888-238-9085.