Secured loans are commercial or personal loans that demand collateral as a condition of borrowing. A bank or lender may need collateral for big loans if the funds are being used to acquire a specific item or when your credit ratings are insufficient to qualify for an unsecured loan. Secured loans may allow borrowers to benefit from cheaper interest rates since they pose less risk to lenders. However, specific fast loans, such as adverse credit personal loans and short-term installment loans, may have higher interest rates.