What is the difference between secured loan and unsecured loan?
please tell me the meaning of secured loan and unsecured loan.
By
Pal
Posted on
11/16/09 Total Answers
3
Answers-
Secured: If you don't pay the loan back, they can take something from you. Car loans you fail to pay, they take the car. Mortgages, they take the house. Part of the loan documents spell out exactly what is the collateral. Keep in mind if they take back the item and auction it off and it doesn't sell for what you owe them, they can then sue you for the difference.
Unsecured: They trust you to pay it back. There is no specific item that you have agreed that they can take if you fail to pay. But, they can still sue you for nonpayment if it comes to that, meaning you'll have a judgement placed on you to pay them back. Judgements give them the ability to garnish wages and levy your accounts.
Answer by :
Jay S On Date
2009-11-16 05:29:14
Dear Sir, You have not mentioned which loan you required. Since there are different securities therefore it is difficult to explain you as you are a lay man. Any how, we advise that where LOAN IS SANCTIONED AGAINST SPECIFIC SECURITY IS CALLED ''SECURED LOAN' and where there is NO SECURITY IS REQUIRED IS CALLED UNSECURED LOAN ' There are different type of securities they are 1. primary security 2. collateral security. Further collateral security is also various type -as Property mortgage and third party guarantee or government security ..
Answer by :
Naveen Kumar On Date
2009-11-16 05:40:19
secured is like when it's backed by money or assets (like say you have $1000 in a savings account and you get a loan against that money, that's secured...or when you get a secured credit card they want you to give them $400 upfront and then they will give you $300 worth of credit to use).
unsecured is when it is not
