S
Loans
Secured Loan
A loan where you pledge an asset — your car, house, whatever — as collateral. If you default, the lender can seize it. The lower risk for them means lower interest rates for you. Way cheaper than unsecured.
Usage Examples
"Thandi got a car loan from Nedbank at 9% because her bakkie was collateral. If she stopped paying, they could repo it. That's why secured loans are cheaper than personal loans at 15-20%."
"Andile's got an FNB home loan with his house as security. It's 7.5% fixed — locked in. Banks love this because they can take the house if he ghosts them. That's why mortgages are way cheaper than unsecured personal loans."
"Zanele went to Capitec for a pawn loan — R3,000 secured by her laptop. Hectic interest rate but fast, and at least if she can't repay, they've got the collateral. No credit check needed."