Unsecured loans for bad credit are not generally a viable option compared to those which are secured against an asset like real estate or automobiles. However, in situations where the borrower does not own a home or does not have adequate equity on their home or car, there is no option but to go for unsecured loans for bad credit.

The different options for availing unsecured loans for bad credit are listed here:

1. Credit Card Debt - This type of unsecured loans are typically given to the credit card buyer by the issuer. You can use your credit limit to pay for any purchase or for cash without exceeding the appointed limit. In effect, this is a lending by the issuer of the credit card. You have to pay back the amount borrowed and the interest as laid out in the credit card agreement. The difference between a credit card and a debit card is that in this case, the issuer does not remove any money from your bank account. Each month you receive the credit card statement showing the total amount due and the minimum amount that needs to be paid. In credit card debt the interest rate is higher than what is charged in other unsecured loans for bad credit.

2. Lines of Credit - A line of credit is a flexible way of getting credit for the purpose of house repairs, travelling or even to buy anything you want to but lack sufficient money. However to be eligible for this type of personal loan, typically the lender would demand a good credit history and stable employment.

3. Bank overdrafts - You can be eligible for this type of unsecured loan if you have maintained a good relationship with the bank. When the withdrawals in your bank account go beyond your balance, the account goes into a negative balance, meaning thereby that the bank has financed your withdrawal. In case you have a previous bank overdraft agreement with specified overdraft limits, any withdrawals will be charged at the fixed rate. However if you do not have an agreement, the charges may be much higher. 

4. Payday loans - The most prevalent personal unsecured loans are payday loans. You can borrow from $100 to $1500 for a short term but at a very high interest rate. The money is supposed to be repaid on payday. If you cannot pay it back on the appointed day, you can pay the charges and roll it over for the next period.  

Bad Credit Secured LoanAs you can see above, though there are numerous options to avail finance in the realm of unsecured loans for bad credit, they are not exactly the most cost effective option. The best option in such cases is the bad credit secured loan. However if there is no asset which can be offered as collateral there may be no other way out except for unsecured loans for bad credit.