1 year, 5 months ago
What is an unsecured debt?
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Unsecured debt is any debt that is not protected by any tangible property. Such debts include unsecured credit cards, department store charge cards and so forth. An unsecured debt is equally important to credit worthiness as a secured debt. Secured debts include automobile loans, home loans, secured credit cards and so on. A secured debt typically means that the note holder or the creditor lends money toward an asset of equal or greater value than the debt itself. This secured property is used as an incentive to motivate the debtor to pay the debt. The creditor can repossess the secured asset when the debtor falls behind in their payment obligation. This can be done through the courts or without the courts and legal actions having been filed.
Both secured and unsecured debt payment history can be equally important to potential creditors. A secured credit card means that the borrower has put forth cash as a means of securing a debt as opposed to the typical secured debt that may be secured by means of physical property.
Both secured and unsecured debt payment history can be equally important to potential creditors. A secured credit card means that the borrower has put forth cash as a means of securing a debt as opposed to the typical secured debt that may be secured by means of physical property.
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