A secured loan is when you offer something as security in return for the money you borrow. This could be your house, your car or your deposits; as long as it has a value, which at least matches the amount of the loan. Secured loan carries a lower rate of interest than an unsecured loan. A disadvantage of having a secured loan is that if you can't keep up your loan repayments, the lender could claim your security to pay off the loan. You must decide whether to pay less interest for a secured loan, and risk your security, or pay more interest for an unsecured loan.

Of course, you should only take out a loan when you're sure you can afford the repayments.