The borrower may not fully enjoy the use of the collateral while the loan is still active. For example, if a boat is used as a collateral, he or she may not be allowed to resell a part or the whole of it or make renovations to it since it could affect its value. Applying for unsecured loans are relatively easier than that of a secured loan. It usually requires less paperwork or documentation, requiring usually only the signature of the borrower and a given schedule for the payment scheme. On the contrary, a loan may be both secured and unsecured. If an individual enters into a secured loan agreement, say $10,000, and uses his automobile as a collateral (valued at $6,000), then his loan is secured only up to $6,000. The

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