A secured loan is a loan that's taken out using something you own as security – this could be your house, car, mobile phone or even your sofa.
If you miss too many payments or default on your loan, a lender can take the security item and use it to pay off what you owe.
An unsecured loan (or personal loan) is a loan that doesn't need a security item. Instead, you'll usually agree to make regular payments until the loan is paid in full.
This includes any interest that accrues over the period of time that the loan is taken out.
How this affects your score
Having a healthy mix of secured debt (like a mortgage) and unsecured debt (like a credit card) can show lenders that you can manage different types of credit and improve your score.