If you’re reading this, it could mean you’re looking for a personal loan.
You may be wondering what an unsecured loan is — and how it can help you.
An unsecured loan is a loan that does not require you to put up items you own, such as your car or home, as collateral to qualify for the loan. Unsecured loans are typically granted to creditworthy borrowers who pose a low risk of not repaying their loan.
All personal loans from Marcus by Goldman Sachs® are unsecured, meaning they are no-collateral personal loans and don’t require you to put up your possessions to be approved for the loan.
Maybe you have multiple high-interest credit cards or other debts that are piling up. If you have good credit and your existing debt has high interest rates, a personal loan from Marcus could save you money and help you pay off your balances sooner.
Marcus determines whether you qualify for an unsecured loan by evaluating factors such as your creditworthiness, income and ability to pay, and not on factors such as the value of your car.
Plus, a Marcus unsecured loan can be used for many kinds of expenses, from a wedding to a big move.
There are many kinds of financing, but Marcus personal loans have advantages. With a Marcus unsecured personal loan, there are no fees. You’ll always know exactly how much you owe each month for the term of your loan, and you won’t be charged any fees on top of what you already owe — only interest.
Let’s take a look at how personal loans compare to other types of financing.
Credit Cards: Credit cards are a way of borrowing money. Though you don’t get a lump sum like you would with a personal loan, you do get a line of credit that you can borrow against.
Credit cards can be useful if you need to make purchases on the go or right away. Once you have a credit card, you can use it to make purchases, but be mindful to make your payments on time and don’t exceed your credit limit. Compared to personal loans, credit cards could have higher interest rates. Credit cards could also have variable interest rates. That means you could be spending more money to pay off your debt than you would with a personal loan that has a fixed rate.
Student Loans: These loans are specifically used to fund education. Marcus personal loans cannot be used to finance education. There are both government and private student loans.
Peer-to-Peer Lending: People sometimes turn to peer-to-peer lending if they want to borrow money without a traditional bank or credit union. These online platforms offer funding by individuals and investors, rather than by a bank. People with money to spare can lend their cash to those who need it, earning interest in return. Online platforms match those who need to borrow with those who are willing to lend. If you borrow money through these forums, you could end up being financed by one or more individuals.
The benefit of peer-to-peer lending is that they sometimes have lower interest rates than borrowing options. On the other hand, their origination fees can range from 1% to 5% of the loan. That can really add up if you’re asking for a large sum of money.
You read that right. No sign-up fees. No late fees — you just pay interest for the additional days. No prepayment fees. No fees. Ever.
The amount you are approved for is the amount you receive. Marcus offers personal loans with rates as low as 6.99% APR — that's lower than most high-interest credit cards. Rates range from 6.99% to 24.99% APR, and loan terms range from 36 to 72 months. Only the most creditworthy applicants qualify for the lowest rates and the longest loan terms. Rates will generally be higher for longer-term loans. Learn more.
Also, your rate will never change for the life of your loan, meaning you’ll pay the same amount on your loan each month, instead of dealing with variable interest rates.
Pretty nice, huh?
The terminology behind loans and finances can sometimes be confusing. So to help, we’ve broken down some important terms for you to better understand the world of loans.
Loan Principal – This refers to the amount borrowed under the loan.
Interest Rate – The interest rate is the rate, expressed as a percentage, charged by a lender to a borrower for use of the loan amount.
APR – Annual percentage rate is the annual rate charged for borrowing. It is the combination of the interest rate and certain additional costs and fees.
Loan Term – The amount of time specified for the repayment of a loan. For example, a Marcus loan term ranges from 36 months to 72 months. A loan term should not be confused with the terms and conditions you agreed to upon taking out a loan.
This article is for informational purposes only and is not a substitute for individualized professional advice. Articles on this site were commissioned and approved by Marcus by Goldman Sachs®, but may not reflect the institutional opinions of Goldman Sachs Group, Inc., Goldman Sachs Bank USA or any of their affiliates, subsidiaries or divisions.