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A secured loan is a loan in which the borrower pledges some asset (e.g. a car or property) as collateral for the loan, which then becomes a secured debt owed to the creditor who gives the loan. The debt is thus secured against the collateral, and if the borrower defaults , the creditor takes possession of the asset used as collateral and may ...
Types of secured loans. There are many types of secured loans. Five of the most common include: Mortgage: With a mortgage, you put your home or property up as collateral to buy that home.If you ...
Recourse debt or recourse loan is a debt that is backed by both collateral from the debtor, and by personal liability of the debtor. [2] This type of debt allows the lender to collect from the debtor and the debtor's assets in the case of default, in addition to foreclosing on a particular property or asset as with a home loan or auto loan.
The debtor is in debt $10K to the secured creditor and $2000 to the unsecured creditors. Assume the debtor defaults and his only asset is the automobile. The dealership can repossess the auto and sell it to satisfy its debt. Two things can happen here: 1) The dealership sells the collateral (car) for more than the amount of the debt (let's say ...
Share-secured loans offer a way to build credit without steep borrowing costs. The funds in your account are used as collateral, making these loans easy to access even if you have little or no credit.
A secured loan is a type of loan backed by collateral that your lender can seize if you don’t make payments. A mortgage is one of the most common types of secured loans. Your home is the collateral.
See U.C.C. § 9-204. Value can include a new loan or an old debt. See U.C.C. § 1-204. Attachment of a security interest does not ensure that the secured party's interest in the collateral will be superior to the interest of other lienors or subsequent buyers, lessees, or licensee.
Secured debt is debt that is backed by an asset, like a car or a house. Should you default on the loan or debt repayment, the creditor can seize this asset instead of opening a debt collection on ...