What is the meaning of “secured creditor”?

A secured creditor in Texas is a creditor who has the legal right to collect the debt owed to them by a debtor in the event of default. This right is secured by giving the creditor a lien against an asset or property owned by the debtor. When a creditor creates a lien on a debtor’s property, the lien gives the creditor a secured claim to the property if the debtor does not make the payments required. In essence, the property or asset serves as collateral to guarantee the repayment of the debt to the creditor. A creditor can also take possession of the property and sell it to recover the debt owed to them by the debtor. In Texas, a creditor must file a lien and other documents with the appropriate county or state office in order to create a secured interest in a debtor’s property. The documents serve as a public record of the creditor’s rights as a secured creditor and will typically list the terms of the agreement between the creditor and the debtor, such as the items or properties that are liened, the debt amount, and the payment terms. In short, a secured creditor is a creditor who holds a legal claim to a debtor’s property in order to guarantee the repayment of a debt. The creditor acquires the right to collect the debt by creating a lien on an asset owned by the debtor and filing the appropriate documents with the relevant county or state office.

Related FAQs

What is a lien avoidance action?
What is the meaning of “secured creditor”?
What is the meaning of “general unsecured debt”?
What is a claim for child support?
What is a discharge injunction?
What is the meaning of “time’s up”?
What is a constructive fraudulent transfer?
When is a creditor’s claim considered “timely”?
What are the appeals rights of creditors?
What is a setoff action?

What is the meaning of “secured creditor”?

Related FAQs

Related Blog Posts