What Is A Secured Debt?

What Is A Secured Debt?

Clients sometimes ask about secured debts since they do not understand clearly what they are. Simply put, any type of obligation where a borrower must pledge property as collateral is a secured debt. Lenders in this situation usually have the benefit of a lien and become “secured creditors.”

Debtors are required to correctly and completely list all of their obligations on schedules of assets and liabilities to be submitted to and filed with the court. A seasoned professional like Theron Morrison and his team of exceptional bankruptcy and collection defense attorneys at the Morrison Law Group may provide all of the related knowledge necessary for any Utah consumer to make the best choice possible based on his or her individual financial circumstances, assets, and liabilities.

Debtors must list or “schedule” their debts in bankruptcy cases based on whether the debt is unsecured, secured, or a priority debt. A secured debt is an obligation backed by collateral that a creditor may recover upon default as defined in the security agreement accompanying the purchase. Examples of secured debts include:

  • mortgages;
  • home equity loans;
  • motor vehicle loans;
  • tax liens;
  • judgment liens;
  • mechanic’s or materialman’s liens; and
  • loans for large appliances and electronics such as televisions.

Bankruptcy debtors must list:

  • the amount of the debt;
  • the creditor’s name and mailing address;
  • the date of the debt;
  • any applicable account number;
  • whether the debt is contingent, liquidated, or disputed (consult with an experienced bankruptcy attorney to learn more)
  • a description of the property that secures the debt;
  • the type of lien;
  • the value of the collateral, and
  • any of the portion of the debt that would be unsecured after subtracting the value of the collateral from the amount of the debt. If the debt is for $100,000 and the collateral is worth $80,000, then $20,000 of the debt is unsecured.

Secured debts are listed on a debtor’s Schedule “D” which is filed with the U.S. Bankruptcy Court.

One of the Morrison Law Group’s qualified and knowledgeable bankruptcy attorneys can answer any bankruptcy debtor’s questions about any relevant bankruptcy law. The Morrison Law Group can also help if you just want to talk about Chapter 7 or Chapter 13 bankruptcy options. Call 801.456.9933 today to schedule a FREE consultation. We have locations in Ogden, Logan, Sandy, and St. George to serve the residents of the counties of Weber, Cache, Salt Lake, Utah, Morgan, Davis, Washington, and surrounding areas.



Theron Morrison

Theron Morrison

Utah’s top bankruptcy and consumer protection attorney.