What is the meaning of “secured debt”?

Secured debt is a type of debt that is backed by some form of collateral, such as a car or a home. This means that if the borrower fails to make payments on the debt, the lender is able to take the collateral in order to repay the debt. In the state of California, creditors have a right to secure debts in order to help ensure that they receive payment on the loan. In the event that the borrower fails to make payments, the creditor can take the collateral to help cover the cost of the debt. This helps to protect the lender and increases their chances of receiving full payment in a timely manner. Additionally, secured debts often have lower interest rates than unsecured debts, making them a more attractive form of borrowing for both lenders and borrowers.

Related FAQs

What is a “bankruptcy trustee”?
What is a claim of exemption?
What is a setoff action?
What is a fraudulent conveyance?
What is a non-dischargeability action?
What is the difference between secured and unsecured creditors?
What is a reaffirmation hearing?
What is equitable subordination?
What is a preference action?
What is the Uniform Commercial Code (UCC)?

What is the meaning of “secured debt”?

Related FAQs

Related Blog Posts