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

In Chapter 13 Bankruptcy Law in Virginia, there is a difference between secured and non-secured debts. A secured debt is one that has some kind of collateral, such as a house or car, which is used as a guarantee for repayment of the loan. If the loan is not repaid, the creditor can repossess the collateral to recover the loan money. Non-secured debts, or unsecured debts, have no collateral. Examples of unsecured debts include credit cards, medical bills, utility bills, and some personal loans. In Chapter 13 Bankruptcy, secured debts are treated differently than non-secured debts. A debtor is allowed to keep secured property, such as a home or car, by entering into a repayment plan to pay back the loan over a 3 to 5 year period. The goal of the repayment plan is for the debtor to pay back a portion of the debt and have the remainder forgiven by the creditor. Non-secured debts, on the other hand, are handled differently in Chapter 13 Bankruptcy. These debts are paid back through the same repayment plan, but typically a lesser amount is paid back over the 3 to 5 year period. If there is any remaining amount after the repayment period has ended, the debt is discharged and the debtor is no longer responsible for paying it back. In summary, the difference between secured and non-secured debts in Chapter 13 Bankruptcy Law in Virginia is that secured debts can be paid back over a 3 to 5 year period with the creditor forgiving the remaining balance. Non-secured debts can also be paid back with the remaining balance being discharged.

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

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