Can I Get a Loan Without Collateral?

Learn more about unsecured loans and how to get one without collateral. Find out what lenders consider when approving an unsecured loan and how to increase your chances of getting approved.

Can I Get a Loan Without Collateral?

Unsecured loans don't require any collateral, such as a house or car, for approval. Instead, lenders issue these loans based on information about you, such as your credit history, income, and outstanding debts. These loans are not as easy to find or as readily available as a standard secured loan, but there are some business loans available that don't require collateral. Wells Fargo Bank may charge late or returned fees and has a high minimum loan amount. If you're looking for an unsecured loan, it's important to be aware of lenders advertising unsecured loans for bad credit or unsecured loans without credit check.

These are not standard personal loans. Wells Fargo personal loans stand out thanks to a wide range of loan amounts and flexible terms, but borrowers cannot prequalify. You can compare the product offered by your neighborhood credit union to personal loans from a bank or online company that provides loans nationwide. Upstart is one example of an unsecured personal loan lender that does not have a minimum education requirement for borrowers to be approved for a loan. Instead, a lender considers your credit score, existing debts, income, and other factors about you in a personal loan application.

To increase your chances of getting an unsecured personal loan, you can improve your credit score and increase your income. You can also apply for it with a creditworthy guarantee. An unsecured personal loan is a loan from an online lender, bank, or credit union that does not require collateral to secure the loan. Borrowers with good and excellent credit (above 689 FICO) generally get the lowest APR on a personal loan. To qualify for the best loan terms, you'll generally need good or excellent credit and a consistent source of income.

If you accept your loan before 5 p.m. EST (excluding weekends or holidays), you will receive your funds the next business day. SBA loans may require more effort to apply, take longer to process, and generally have stringent eligibility requirements for approval. When you formally apply for the loan (which is different from prequalification), the lender will conduct a rigorous credit investigation, which will cause a temporary drop in your credit rating. Private lenders are willing to offer unsecured loans if the business owner offers a personal guarantee.

Customers with credit difficulties should seek credit counseling before making any loan transaction.