Secured debt

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Secured debt

Debt that has first claim on specified assets in the event of default.

Secured Debt

A debt on which payment is guaranteed by an asset or lien. This means that a secured debt has collateral; if the debtor does not repay the debt in due course, the creditor has the legal right to take possession of the collateral and resell it to recover losses. In case of bankruptcy, the creditor is considered a secured creditor, which means the creditor receives proceeds from the sale of the collateral to satisfy the debt. If the collateral is insufficient, all secured creditors must have their debts satisfied before any unsecured creditors receive any funds.
References in periodicals archive ?
(Chapter 13 Bankruptcy, which allows people with regular income to pay off their secured debts over a timeframe, is an option for those with a steady income who want to be sure of keeping their house or other property tied to a secured debt).
There are two types of debts - unsecured and secured debts. The essential difference between unsecured and secured debts is that with unsecured debts there is no physical property or product directly attached to the debt, and thus the interest rate is higher due to the greater risk to the lender.
A A DRO will normally last for one year and at the end of this period, the person will be free of all debts in in the order Q What a about secured debts? A A person will still be liable for any secured debts after the end of the DRO | Your local CAB can provide more detailed advice and assistance on Debt Relief Orders.