What is Secured Debt?
A. A Secured Debt is a loan where the creditor retains a security interest in an item of real or personal property such as a house or an automobile. If you fall behind on payments on this type of debt, the lender has the ability to repossess the property in order to mitigate their damages. It is important to remember that you could remain liable for any deficiency balance owing after the property has been repossessed and sold. Certain exceptions may apply and will depend on the exact nature of the security interest. The laws regarding home mortgages vary from state to state and the lenders rights generally depend on the terms of the mortgage and whether any other lenders have an interest in the Real Property. In these situations it is important to seek competent legal advice to protect your interests.
A secured debt is a loan where the creditor retains a security interest in an item of real or personal property such as a house, or an automobile. If you fall behind on payments on this type of debt, the lender has the ability to repossess the property in order to mitigate their damages. It is important to remember that you could remain liable for any deficiency balance owing after the property has been repossessed and sold. Certain exceptions may apply and will depend on the exact nature of the security interest.
Secured debt is any type of indebtedness where the outstanding balance is covered by some item of value. By acquiring the right to take control of the item of value, a lender is able to guarantee a return on the amount of the loan or the line of credit that was extended to the recipient. Essentially, the ability to acquire the item of value makes the debt secure for the lender. The use of secured debt is common in lending situations. Bank loans are an excellent example. Banks will extend loans for a number of purposes, such as the purchase of a vehicle or to finance an improvement project on a piece of property. In exchange for granting the loan, the debtor pledges some type of collateral. The collateral will be an item of value that could be turned over to the creditor in the event that the recipient of the loan fails to make payments on the outstanding balance. This arrangement is usually referred to as secured loan or a secured debt loan. Secured loans are often attractive to the re
