Secured Loan
A secured loan is backed by collateral such as a home or vehicle. If the borrower defaults, the lender can seize the collateral to recover losses.
Secured loans usually carry lower interest rates because the lender's risk is reduced. Mortgages and auto loans are common examples.
Related Terms
Collateral
Collateral is an asset that a borrower pledges to a lender as security for a loan. If the borrower d...
Lien
A lien is a legal claim or right against a property, typically used as security for a debt. The prop...
Mortgage
A mortgage is a loan used to purchase real estate, where the property serves as collateral. The borr...
Auto Loan
An auto loan is a loan used to purchase a vehicle, with the vehicle serving as collateral. The borro...
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