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Some common types include home mortgages and auto loans, as well as predatory ones like title loans and pawnshop loans. Following is an explanation of the three types of consumer credit: ... non-installment credit can also be secured or unsecured and is a good choice for those individuals who find it hard to make regular repayments after a fixed interval. The two major categories for consumer credit are open-end and closed-end credit. For example, most standard types of mortgages and auto loans are considered secured credit, because the loan holder can take possession of your house or car if you don’t pay as agreed. What are the Types of Credit? Secured credit cards. Secured loans are typically easier to qualify for than unsecured loans. When you fall behind on your taxes, statutory law gives the IRS the right to a tax lien against your property. The cash deposit acts as collateral against your credit card spending, so it is more of a “secure” loan for the lender. T he three main types of credit are revolving credit Revolving Credit Facility A revolving credit facility is a line of credit that is arranged between a bank and a business. Borrowers with poor credit and those who are rebuilding their credit are more likely to be considered for a secured loan than an unsecured loan. Due to the help of technology businesses can now analyze the data quickly and assess customers credit risk profile. Types of Credit Options. Think of it as an insurance policy for the bank, since secured card applicants typically have little or no credit, or are rebuilding bad credit, they are considered risky. These days, however, it is far more common for loans to be secured directly by the asset being financed (like a house or vehicle), or by revolving, unsecured credit (like a credit card). On the other hand, an unsecured loan or line of credit doesn’t require any collateral. Open-end credit, better known as revolving credit, can be used repeatedly for purchases that will be paid back monthly. 1. With a secured credit card, your spending limit is determined by the amount of your deposit. Generally, a secured transaction is a loan or a credit transaction in which the lender acquires a security interest in collateral owned by the borrower and is entitled to foreclose on or repossess the collateral in the event of the borrower's default. The terms of the relationship are governed by a contract, or security agreement.A common example would be a consumer who purchases a car on credit. A secured credit card is backed with a cash deposit that you are required to put down. She has made 10 payments of $1,000 each and has requested the title (ownership papers) to the car. Credit cards and personal loans are examples of unsecured loans. Winning a money judgment $ 1,000 each and has requested the title ( ownership )! 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