What are the different types of Debts?
There are three main types of debt. The first category is secured debts. Secured debts are debts that have collateral against the note. Examples of a secured debts are your house and car. If you don’t pay your house payment, the creditor will pursue foreclosure. If you don’t make your car payment the creditor will repossess the car. The second category of debt is priority debt. These debts are debts owed to the government. Examples of priority debt are IRS debt and back due child support. These are debts that you typically have to repay , however there is no collateral to take if you do not. It is important that you discuss these debts with your attorney so they can advise you what your repayment responsibility is. The third main category is unsecured debt. Unsecured debts are the other items on your credit like credit cards, medical bills, payday loans, personal loans, etc. In most cases, these debts can be discharged in your bankruptcy. One type of unsecured debt that is not discharg
Many Consumers in their daily lives do require money on credit and there are many financial institution who do provide different lending options to such consumers.The amount taken on credit is known as Debt. The Debtor has to pay back this debt amount to the creditor with interest on the conditions pre-decided. There are three types of debt: the secured and unsecured debt, installment and revolving debt, and those debts which vary in the debt source. The secured debts have collaterals. When we say collateral, it is the security pledged as a guarantee for payment. If you transact a loan by pledging your car, house or whatever asset, it means you have a secured loan. There is no collateral for unsecured debts. One example of unsecured debt is your credit cards. The next way to classify or to identify the type of your debt is to identify whether it is installment or revolving. The basis for this classification is your payment schedule. An installment debt is one wherein you pay a fixed mo
