Some seniors may think that getting a loan during retirement is impossible, but that is far from the truth. An unsecured loan may be difficult for a retired senior to qualify for, but secured personal loans are just right for seniors who need a little financial assistance during retirement. A secured loan can either be a business loan or a personal loan and it requires some form of collateral. An unsecured loan requires no collateral and is usually based on your credit score and yearly income.
Because seniors usually do not have a fixed income and rely on their retirement savings or Social Security payments, secured loans are a great alternative to traditional loans. Seniors can benefit from a variety of different secured loans based on their needs. Seniors can apply for mortgage loans to help pay for a new home or refinance their old home and make their mortgage more affordable.
Other secured personal loan options also include secured auto loans for car purchases and the vehicle is usually held as collateral for the loan.
Similarly, the home you are purchasing is also usually held as collateral for a mortgage loan.
Other secured loans, such as home refinancing loans, hold the equity you have invested in your home as the collateral.
For these types of loans, you need to have a certain percentage of equity in your home. The amount of equity you need for refinancing will depend on the lender you choose to use. Debt consolidation loans work in a similar way in that they depend on the amount of debt you have.
If you are a senior in need of temporary financial assistance, a secured personal loan may be right for you.