Asked by Sammie Schwab on Jun 08, 2024
Verified
Debt that is "backed" by a mortgage, a pledge of collateral, or another lien is called which of the following?
A) Real debt
B) Liable debt
C) Credited debt
D) Secured debt
Secured Debt
A type of debt that is backed by collateral, providing the lender with a claim to the asset if the debt is not repaid.
Mortgage
A loan specifically used to purchase real estate whereby the property itself serves as security for the loan.
Collateral
The property or assets that a borrower offers to a lender as security for a loan.
- Comprehend the concept of secured versus unsecured debt and how it impacts the bankruptcy process.
Verified Answer
MG
Murad GhaidanJun 13, 2024
Final Answer :
D
Explanation :
Secured debt is debt that is backed by collateral, meaning if the borrower defaults, the lender can seize the asset that was used as collateral to recover the owed amount.
Learning Objectives
- Comprehend the concept of secured versus unsecured debt and how it impacts the bankruptcy process.
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