What is the difference between a secured and non-secured debt in Chapter 13 Bankruptcy?

The difference between a secured and non-secured debt in Chapter 13 Bankruptcy is mainly in the amount of priority that each type of debt has. Secured debt is debt that is secured by some sort of collateral - usually property or a major purchase like a car or boat. Because of the collateral, a secured debt has priority over non-secured debt in Chapter 13 Bankruptcy. This means that the secured debt must be paid back before any of the non-secured debts. Non-secured debt is any kind of debt that is not backed by any collateral. Examples of non-secured debt include credit card debt, medical bills, and personal loans. Because these debts are not backed by collateral, they are lower in priority than secured debt. This means that if you file for Chapter 13, your non-secured debts may not get paid back at all. However, if there is enough money to pay back all of your debts, some of the non-secured debt may get paid back. In South Carolina, all Chapter 13 Bankruptcy filers must go through credit counseling before filing for bankruptcy. This helps the filer understand the differences between secured and non-secured debt, and plan a bankruptcy repayment plan accordingly.

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What is the difference between a secured and non-secured debt in Chapter 13 Bankruptcy?

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