How does a secured creditor collect funds?

In Hawaii, a secured creditor is a creditor that has a lien on a certain asset of the debtor, such as a car, a boat, or a house. A lien is a legal right that gives the creditor the ability to take possession of the asset if the debtor fails to pay the debt. When a secured creditor collects funds, the creditor often repossesses the asset the debt is secured by. The creditor can take legal action to repossess the asset and usually will require that the debtor turn over the asset. The creditor may also be able to sell the asset to repay the debt. If the asset is sold, the creditor obtains the legal right to the proceeds of the sale. The creditor can then use the proceeds to pay what is owed. The amount paid to the secured creditor must first be applied to the cost of repossession and sale, and then any remaining proceeds will be applied to the debt. If the asset is not sold and the debtor does not pay, the creditor may also be able to sue the debtor. If the creditor is successful, the court can enter a judgment against the debtor that does not require the asset to be sold. The creditor may then have the legal right to garnish the wages of the debtor or seize any other assets of the debtor to pay the judgment. In any case, the creditor cannot take action outside of the law when collecting funds. The creditor must follow the applicable rules and regulations to ensure that their rights are protected.

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How does a secured creditor collect funds?

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