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The two basic types of loan are "secured loans" and "unsecured loans".
A secured loan is only an option if you are a homeowner and you are prepared to offer your lender a legal charge on that property. (If you are a joint owner, then all owners must agree top a charge being put on the property.) When you have paid off the loan, the charge is then cancelled - but if you default, the lender can apply to the courts to repossess the house and sell it in order to recover the money it is owed. Clearly, a secured loan represents a much lower risk to the lender and so they reserve their lowest rates of interest for secured loans. You should not lightly enter into a secured loan as, if things go wrong, you could loose your home.
Unsecured loans are loans where you do not provide any security to the lender. This means that the lender is relying on their legal agreement with you and the process of law to recover the money from you if things go wrong.
All the other types of loan are either descriptions of the types of person who can apply, e.g. tenants loan, or the use to which the loan is being put, e.g. home improvement loan, bridging loan, debt consolidation loan or car loan etc. So long as the lender believes that it will be repaid, there is virtually no restriction on the way you can spend the money.
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