A personal loan is money borrowed for personal use and repaid in fixed installments over a set term. It can be used for many everyday purposes, such as a repair, a bill, or consolidating other debt.
A personal loan is a general-purpose installment loan that you can use for a wide range of personal needs rather than one specified asset. Personal loans are commonly unsecured, meaning they rest on the customer's income and signed promise to repay rather than collateral, though some are secured. They contrast with purpose-specific borrowing such as an auto loan or a mortgage, which are tied to a particular asset that also serves as collateral. Personal loans are typically repaid through equal scheduled payments that include both interest and principal. The amount, term, interest rate, and any fees vary by lender and by the customer's profile.
