Types of Secured Loans and Lines of Credit

By using your personal assets such as your home or savings as collateral for a secured loan, you could access lower interest rates and better borrowing options.

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Finding the loan that’s right for your situation is important, so that you get the rates, terms, and payment options that fit your needs. Secured loans might be a good choice if you have personal assets such as equity in your home, car, or savings account that can be used as collateral. Plus, secured loans may have lower interest rates, larger loan amounts, or better terms than unsecured loans. Keep in mind, with a secured loan, the lender can take possession of the collateral if you don't repay the loan as agreed.

Types of secured loans and lines of credit

Here are a few personal assets that can help you secure a loan.

If you use your CD or savings account as collateral for a loan or line of credit, you can typically qualify within hours and have the funds within the same or next business day. You could also receive the added benefit of a lower Annual Percentage Rate , compared to an unsecured option.

You can also use your savings as collateral for a secured credit card. Secured cards work like any other credit card, but the credit line is determined by how much money

you place into a security deposit account as collateral.

With a secured credit card, you can build or rebuild your credit history by using the card responsibly and making your payments on time. Keep in mind that the security deposit is collateral and can’t be used to make payments. While credit line minimums and security deposits vary by lender, Wells Fargo offers a secured card starting at $300.

  • CD/Savings Secured Loan
  • CD/Savings Secured Line of Credit
  • Secured Visa®Card

Consider using the equity in your home to help pay for home improvements or a large expense. To know how much equity is available to you, look at the difference between your home’s market value and how much you still owe on your mortgage. For example, if you own a home currently valued at $300,000 but still owe $200,000 on your mortgage or to lenders, your equity in the home is $100,000.

At Wells Fargo, you can access the equity in your home with:

  • Home equity financing
  • Cash-out refinance mortgage

Using a Wells Fargo CD or savings account as security for a loan or line of credit may enable you to qualify within hours and get the funds on the same or next business day.

Deposit products offered by Wells Fargo Bank, N.A. Member FDIC.

Equal Housing Lender

Category: Bank loan

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