The cost of getting unsecured personal loans is going down; at least, for the time being. Early in 2011 several banks announced that they have dropped their rates for unsecured loans. Bank of America, Kaiser Federal and Wells Fargo, among others, have gotten into the act by offering rates starting as low as 2.99 percent up to 4.99 percent. It seems that they are interested in making a customer out of you. Why did this happen all of a sudden?
Personal loans, whether secured or unsecured, are big business for all banks. When the economy took a turn for the worse, the banks companies lost business. They lost it because people were uncertain about the futures, and because people had lost their jobs. People without jobs are not good prospects and not usually eligible for unsecured personal loans. As workers started back into the workforce, the economy started to show a spark of life. With that renewed optimism, the banks decide to attract new customers — customers who could once again afford and qualify for a loan. The plan is to not only get those prospects, but also others who are still working, but on the fence about taking out a personal loan.
Secured personal loans have not been as much of a worry for banks as far as borrower eligibility goes. By nature, something is on the line for the consumer that makes them more prone to paying on the debt. Additionally, if the consumer defaults, the bank has a way to get some or all of its money back. Although based on good credit and good faith, unsecured loans do not offer that kind of safety.
While the interest rates for unsecured personal loans are so low, this might be a good time to take one out. You can use it to pay off or consolidate debt, make home improvements, purchase a car, finance school or most any other thing you desire. When it comes to this kind of loan, the bank is not interested in why you need it, they are just glad that you do.