In this video, we explore the difference between secure vs. unsecured debt, and compare them side by side to see what makes them different
What is Secured Debt?
Secured debt is backed by collateral, such as a house or a car. It has lower interest rates, but higher risk, as you may lose the collateral if payments are not made over time. Examples include a mortgage or auto loan. With secure debt, you risk losing assets.
What is Unsecured Debt?
Unsecured debt is a loan that is NOT backed by collateral. It typically has higher interest rates due to the lender taking on more risk. Examples includes credit cards or personal loans. With unsecured debt, you risk high interest payments that may be difficult to pay off over time.
