The type of loan you choose depends on the needs of your business. The main types of loans are personal, business, secured, and unsecured. Personal loans can be used for a variety of purposes, including financing a home, buying a car, or paying off student loans. They can be availed as a one-time lump sum or in the form of an open-ended line of credit up to a predetermined limit. Personal loans are generally offered by banks and online lenders. Secured loans require the borrower to pledge something valuable that can be seized in the event of default, such as real estate or a vehicle. Unsecured loans, on the other hand, are based solely on a borrower’s credit score.