 TITLE: What Can Be Used as Collateral for a Personal Loan? CONTENT: Pros and Cons of Collateral on a Loan\n-------------------------------------\nPutting up collateral for a secured personal loan may be the only way you're able to borrow, but keep in mind that doing so comes with both pros and cons.\nPros include:\n*   Putting up collateral may make it easier to obtain a loan than if you don't put up collateral, particularly if you have a damaged credit history or no credit history at all.\n*   Because your collateral reduces the financial risk for a lender, you may be able to borrow more money than you'd be able to with an unsecured loan.\n*   Secured loans typically offer lower interest rates and longer repayment periods than unsecured loans.\n*   A secured loan may help boost your credit. Making on-time payments toward a secured loan can help you establish a credit history if you don't have one or help improve your credit if it's been damaged. If this is a priority for you, make sure your lender reports your payments to the major credit bureaus.\nCons of a secured personal loan backed by collateral include:\n*   Your collateral could be taken by the lender if you default on the loan.\n*   Aside from seizing your collateral, a lender may tap a debt collector to seek overdue money from you, may report your missed payments to credit bureaus or may even take you to court in an attempt to collect what's owed.\n*   If you use a savings account or CD as collateral, a minimum balance may be required.\n*   The lender may restrict how you use the money you borrow.\n*   Some lenders may charge high interest rates or high fees for secured personal loans, especially if you have bad credit. END