There is more than one type of personal loan.

There are two types of personal loans: unsecured and secured. Unsecured loans are loans that aren't backed by assets. The lender does not have collateral it can seize if you default on your loan. As a result, unsecured loans generally come with higher interest rates to offset the additional risk incurred by the lender.
A secured loan, on the other hand, is a loan backed by an asset, known as collateral. In the event that you can't pay back your loan, the lender typically has the right to claim your asset as payment. Secured loans are fairly common. Mortgages, for example, are secured loans backed by the borrower's house, and auto loans are secured by the borrower's car. If you're looking to save money, a secured loan might be ideal. But you may want to make sure you can pay it off first, since you stand to lose whatever you put up as collateral if you default.

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