What's the difference between a secured and unsecured personal loan?

Secured loans require you to surrender something of value to the lending institution as the collateral until the loan has been repaid. The collateral can be your car, your home, or other valuable personal property. If you are unable to repay the money, the lender will have the right to take possession of the collateral and sell it to recover their loss. 

Unsecured loans do not require any collateral. So if you cannot repay the loan, the lender will not have any collateral to take possession of.

Because unsecured loans are riskier to lenders, often, it is harder for you to obtain an unsecured loan. Also, often the interest rate on unsecured loans is higher than with secured loans to compensate for the risk that the lender takes on.

With a secured loan, you have to provide collateral. if you default, the lender can take posession of the collateral. Mortgage loans and car loans are some examples of secured loans. But you can get smaller loans with collateral like stocks or a future paycheck (not recommended). Given the lower risk the lender has to incur, secured loans usually come with lower interest rates. 

An unsecured loan is not protected by any collateral, so in case you default, the lender can't automatically take your property. They will have to sell your debt to collections, settle or take you to court instead. Higher risk for the lender generally means higher interest rates for the borrower.