What is the difference between secured and unsecured debt?

In Nebraska, secured debt and unsecured debt are two types of debt that can be included in a bankruptcy case. Secured debt is debt that is attached to some type of asset. Examples of secured debt include mortgages, car loans, and other loans backed by collateral. When secured debt is included in a bankruptcy, the debtor must surrender the property that was used to secure the loan. Unsecured debt, on the other hand, is debt that is not attached to any type of asset. Credit cards, medical bills, and most personal loans are all examples of unsecured debt. When unsecured debt is included in a bankruptcy, the debtor does not have to surrender any property. Instead, the debt is discharged and the creditor will no longer be able to collect on the debt. The main difference between secured and unsecured debt is how it is affected by a bankruptcy. Secured debt will require the debtor to surrender the property used to secure the loan, whereas unsecured debt is simply discharged.

Related FAQs

What documents will I need to file for bankruptcy?
How long does it take to file for bankruptcy?
How does the bankruptcy court decide which creditors will get paid?
Is it possible to have a bankruptcy case dismissed?
What are the restrictions for filing for bankruptcy?
Are there any types of debt that will survive a bankruptcy discharge?
How do I know if I qualify for a Chapter 7 bankruptcy?
Is bankruptcy a public record?
What is the difference between a Chapter 11 and a Chapter 13 bankruptcy?
Does filing for bankruptcy have any effect on other legal proceedings?

What is the difference between secured and unsecured debt?

Related FAQs

Related Blog Posts