undersecured loan

undersecured loan

A loan in which the collateral is not worth as much as the debt.

References in periodicals archive ?
Traditional forms of security were becoming problematic, leading after 1830 to experimentation with other forms such as land, bank shares, and goods.(18) Following several mid-nineteenth century economic crises, banks became more attentive to undersecured loans. Yet by the second half of the nineteenth-century, Scottish banks claimed with some assurance that no borrower with adequate prospects and security was ever turned away.