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Banks offers a variety of financial products, the personal loan is one of them.

Bank can provides many types of loan. The basic two types are:

1. Secured Loan

In Secured Loan the bank take guarantee.

2. Unsecured Loan

In Unsecured Loan the bank doesn't take any guarantee.

Home loan is a type of Secured loan. On the other hand Personal Loan is the type of the Unsecured Loan.

Personal Loan gives without any guarantee means bank doesn't told you to pledge any asset. So, that's why the interest rate in these types of loan is more as compared to the secured loans.

In case of the personal loan bank maintains the strict standards. Bank analysis the person's Income, his/her Credit details and efficiency to repay the previous loan. After these measures the Bank can gives the personal loan.