Firstly, no lender will approve every single application. But, it may surprise you to know that many reputable lenders will approve above 98% of applications even those applicants with poor credit. The reason is because lenders of this type of loan, usually called a bad credit personal loan or payday loan, does not run a credit check. The lender is concerned that the applicant has the required minimum attributes.

So, what are these minimum requirements? In simple terms the lender wants to be able to be sure that the borrower is who they claim to be and that they live where they claim to live and that they receive a monthly income that can be proved.

Therefore, if you’re over eighteen, have been living at your address for a certain period of time, have a cleaning checking account, have a regular monthly income of over $1,000 and are not undergoing any bankruptcy proceedings then you will get approval.

Of course both legit lenders and scammer will approve you, so how can you be sure that the lender is one of the good guys?

This isn’t that difficult. Before applying for the loan you can check out the many consumer organization who release reports on just about every lender; if the lender isn’t known to them then you should stay well clear. You can also check out the lender with the Better Business Bureau. You could even talk to your own bank who may be able to refer you to a reputable lender.

Another good way of making sure the lender is legit is finding out about what other services they offer. What I mean by this is what type of financial advice and services do they offer when you take a loan out with them.

A reputable lender may offer things such as a free credit report when you take out the loan; getting this report not only makes interesting reading but you may even be able to find out why your credit score is lower than you perhaps thought it would be.

Also, some lenders will offer a debt consolidation service – make sure it’s free. This can be really useful in helping you get your finances back in shape. Credit repair service may also be offered – again, if they are offered and are free – this indicates a company who is going to rip you off.

Finally, and most importantly, check whether the lender has a business address (not just a post office box) and that it offers a 24/7 phone number or helpline.

Remember; lenders, who offer guaranteed unsecured personal loans should operate no differently to other lenders (or any other business for that matter) so, ask yourself what things would inspire confidence in you with these other types of business. If the lender fulfills the requirements you have in other businesses, then they are probably legit.

A loan can be may secured against an asset that the lender could sell if the borrower stopped making repayments. The most common example of this type of loan is of course a mortgage on a house called a mortgage. It is equally possible to guarantee a personal loan with a car, valuable jewelery, antiques or even stock certificates (if they are worth anything these days, that is!).

A secure loan is better if you have the security to offer, want a longer term loan and are confident in your ability to service the debt – you don’t want to lose your security after all.

In contrast a non-secured loan is made to you as an individual and the lender is trusting in your ability to make repayments – and your willingness to do so. A classic case would be a young graduate in their first job – they might be making a reasonable salary but not have any assets yet but need a loan to finance a car or clothing for their new job. In this circumstance although the non-secured loan will cost a little more – it will not only allow the borrower to buy what they need, they will also be on their way to building up their credit record so that when the time comes for a big a loan they will most likely be in a position to be approved.

Both types of loans have their place – its up to the borrower to decide which is best in their situation.