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Secured loans rely on an asset as collateral. A car title loan would be an example of a secured loan. If a borrower defaults on a secured loan, the lender can take possession of the asset to cover the loss of the loan. In the case of an auto title loan, the lender would take possession of the vehicles title if the borrower defaults on the loan. Unsecured loans do not require collateral; however, they do charge higher interest rates.
The borrower must also pay any fees outlined in the agreement. Monthly fees can be costly. Some lenders charge as much as 25 percent of the borrowed amount. Before applying for a loan, its a good idea to ask the lender about the annual percentage rate (APR) on their loans.
The annual percentage rate (APR) payday loan los angeles ca borrowers how much it costs to borrow money for one year.
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In most cases, YES.