What is the difference between secured and unsecured debt?

The difference between secured and unsecured debt in Virginia is that secured debt is backed by collateral or some sort of property from the debtor. In the event of default, the secured creditor has a legal right to take possession of this collateral to satisfy the debt. Examples of secured debt include mortgages, auto loans, and student loans. Unsecured debt, on the other hand, does not have any collateral attached and is not legally secured against a particular asset. In the event of default, an unsecured creditor cannot pursue a debtor’s property but can still pursue other legal means to collect the debt. Credit card debt, medical bills, and personal loans are all examples of unsecured debt. In the context of bankruptcy law in Virginia, it is important to note that secured debt typically cannot be discharged and the debtor is still obligated to pay the full amount. On the other hand, unsecured debt may qualify for discharge or and a portion of it may be discharged, depending on the circumstances.

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What is the difference between secured and unsecured debt?

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