 TITLE: Are Unsecured Loans a Good Idea? CONTENT: What Is an Unsecured Personal Loan?\n-----------------------------------\nYou can get unsecured personal loans from banks, credit unions, online lenders and through peer-to-peer lending platforms. Typically, personal loans can be used for any purpose you choose, although some do have restrictions placed on them. After you apply for the loan and provide the necessary financial information, your application will be approved or denied depending on your creditworthiness and other factors.\nAn unsecured personal loan is a type of installment credit, meaning you repay it over a set amount of time by making a certain number of fixed monthly payments. You'll typically need to start making payments on the loan as soon as you receive the proceeds. In most cases, the lender will disburse the money directly to you; however, if you're getting the loan to pay off credit card debt, the lender may send the money directly to the credit card companies.\nIf you don't already have an installment loan such as a student loan or car loan, getting an unsecured personal loan and making payments on time can have a positive impact on your credit scores by enhancing your credit mix. Credit mix, which refers to the variety of credit types you have, counts for 10% of your FICO® Score☉ . END