To fully understand the meaning and / or the definition of unsecured payday loan it is necessary to refer to the historical term of “unsecured”.
So a first definition or meaning of unsecured is that of manual or handwritten writing. Even today, any word with the prefix “chiro” indicates manual skills: eg, the chiropractor (the one who heals with his hands), the fortune teller (the one who reads the hand), etc.
Transported in today’s financial sector, the meaning of unsecured financing indicates any type of unsecured credit guaranteed by the signature alone, even if this is more than one. Some sites report that the unsecured would be only the one-sided, single signature, but this is not the case since what matters to be defined as unsecured financing is the guarantee which must be made up only of the signature (personal guarantee) which, although double (with guarantor) will not change the legal nature of this form of credit.
From this meaning derive all the various hypotheses that include the name of unsecured: thus unsecured credits are those given with the only signature and, repetitively, unsecured creditors are those who have granted loans “contenting themselves” with the only guarantee refreshment of the loaned capital.
On the other hand, debtors or unsecured debts are those who, on the passive side, guarantee something only with the signature. While, from unsecured creditors, privileged ones are distinguished: the distinction between privileged and unsecured creditors is important in the event that there is competition from multiple creditors because if the money to pay them all is not enough, the privileged credit (e.g. assisted by pledge or mortgage) will be paid first, then, if something remains, it’s up to the unsecured.
After the exhaustive summary of the unsecured signature, we come to what are the unsecured online loans. These, only in appearance, are divided into unsecured payday loans and unsecured payday loans. The aforementioned subdivision is however only formal: in substance, there is no difference between a loan and an unsecured payday loan.
The characteristic common to both, therefore to all unsecured payday loans, is that which is independent of real or material guarantees: to be clear, unsecured payday loans are free of mortgages or pledges. Unlike mortgage loans, the only guarantee given in unsecured payday loans is the signature. The latter, we repeat, can be unique, but it can also be double or triple, etc. if one or more guarantors intervene to protect the underlying unsecured payday loan.
Unsecured payday loan calculation
All the characteristics listed above, affect the calculation of the interest and the installment of an unsecured payday loan both as regards the amount applied and the repayment times that unite it and both a personal loan and a lease while it remains very distant from a mortgage loan. More details on installment calculation and interest on an unsecured mortgage where the reasons why an unsecured payday loan has no point in common with a traditional mortgage loan beyond the calculation are explained.
What is a loan or unsecured payday loan in essence?
Well, we can answer without a shadow of a doubt that unsecured financing is nothing more than the very traditional personal loan disbursed in the presence of the only income certification which certifies the revenue from those who ask for funding, besides, it is natural, the subscription.
Ultimately, the unsecured payday loans or loans include, for example, all personal, finalized, assignments, honors, etc. which have the commonality of being totally free of material, real guarantee. The latter, on the other hand, we find instead in mortgage loans and in a lien on credit which instead are par excellence far from unsecured payday loans as they are real in nature.