Personal loans are also referred to as signature loans and are loans given to individuals for a variety of personal uses. These loans can be divided into a range of types depending on the collateral used, the intended end use and the time period through which the loan is to be paid back. When basing the types on collateral, the loans can be divided into secured and unsecured loans. For secured loans, the one who is applying for the loan would give collateral in order to get the loan whereas for unsecured loans no collateral is needed.
The intended end use divides personal loans into a myriad of loans including car loans if the intended use is the purchase of a car, medical loan if intended for healthcare and household loans if to be used on household needs. The time period divides this type of loans into short term and long term loans with short term loans being those whose repayment period is from ninety days to three years. The long term loans are those whose repayment periods are usually up to six years long.