What is required for a loan to be considered “secured”?

In Kansas, for a loan to be considered “secured” it requires two elements. First, the loan must be backed by a type of collateral. Collateral is something of value, such as property, that the borrower agrees to give up if they do not pay the loan back. This provides the lender with assurance that their loan will be paid back. Second, the borrower must sign an agreement called a “security agreement”, which is a contract between the lender and the borrower. This agreement states that the borrower agrees to provide the collateral as a guarantee for repaying the loan. The lender can then take the collateral if the borrower does not pay back the loan. This means that secured loans provide the lender with greater protection than unsecured loans, as the lender has something of value to use if the borrower defaults. However, the borrower may also have more security in the event that they do not pay back the loan, as the lender can only take the collateral and nothing else. Overall, for a loan to be considered “secured” in Kansas it requires collateral and a security agreement. This provides the lender with assurance that their loan will be paid back, while also giving the borrower some security if they are unable to repay the loan.

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What is required for a loan to be considered “secured”?

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