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 Personal loans are given out with an interest repayment cost added. This will either be fixed or variable. Personal loans can be secured or unsecured. An unsecured loan is usually for a smaller amount and is repaid over a shorter period of time than a secured personal loan. The loan will usually involve the calculation of the loan plus the interest rate. The repayments are then spread over a set period of time. Short term loans can be for as little as 6 months and longer unsecured personal loans can be as long as a five year repayment option.
A secured personal loan could be for something like a car or a house (usually called a mortgage, it is still a personal loan). A secured personal loan means that the bank will own the item that you are buying with the money for the time that the loan is being repaid. Secured personal loans are usually for larger amounts of money and spread over a longer period of time. A mortgage for example can be spread over a period of 25 years. Secured loans usually have a lower rate of interest as they are spread over such a long period of time.
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