How to Get an Unsecured Loan From a Private Lender

If you want a loan that doesn't use your house or car as collateral, you want an unsecured loan. Most unsecured loans are used for personal reasons such as paying down high interest credit cards. Obtaining an unsecured loan can sound challenging but it's really quite easy providing you have the right tools and resources.

Difficulty: Moderately Challenging

Instructions

1. Request a copy of your credit report. You're entitled to one free copy annually from the Annual Credit Report website. If you see any anomalies, report them to the credit bureaus immediately.

2. Determine the amount of money you want to borrow. You'll pay interest on this loan, so come as close to the exact amount you need to borrow without going over.

3. Search Lending Tree for a suitable lender. Look for a reputable lender with a decent interest rate. To calculate interest, use the amortization calculator and insert the amount of loan, the interest rate and the term of loan in years.

4. Gather the data you need to fill out an online application. This includes employment history, income, references and current and former residences.

5. Fill out and submit the application. If you application is accepted you have entered into a contract with the lender to pay the loan off within the terms of the contract. Be sure to read the fine print on the application so you are comfortable with all of the terms.

Tips & Warnings

• The higher your credit score, the easier it is to obtain a unsecured loan. If you know your credit score and you keep an eye on your credit report, you'll be in a good position when it comes time to apply for your loan.
• Be wary of submitting more than one application in a 6 month period. Every loan application goes on your credit report and can negatively affect your credit score.

Resources

• Lending Tree
• Annual Credit Report website
• Amortization calculator