Credit can be confusing. There are many different types of credit and understanding them before borrowing is important. Secured credit is one of the most popular types of credit and usually the easiest to get. Secured credit is when you place an asset up as collateral for the loan. Basically, if you default on the loan the lender takes ownership of whatever asset you used as collateral.
Secured loans can be closed end or open end. Closed end loans are usually just called a loan. With this type of secured loan the collateral is usually what you are getting the loan to buy and the lender holds ownership over it until the loan is completely paid.
Some examples are auto loans and home loans, where the lender is the owner of the auto or home until it is fully paid off. An open end secured loan is often called a line of credit. This type of loan is secured with a deposit of either cash or an asset. An example is a home equity line of credit where you use the equity in your home to get a loan.
The difference between the two types of secured loans is really in the details. A closed end loan is usually the only way to buy very expensive items, like a home. The bank...
To view and download this full PLR article, you must be logged in. Registration is completely free. Once you create your account, you will be able to browse, search & downlod from our PLR articles database of over "1,57,897+" on 1,000's of niches and 200+ categories without paying a penny. Click here to signup...
