Unsecured Loan

Definition

  • A type of loan that is given to a borrower without collateral such as property that is acceptable as security for the loan.

Synonyms
unenforceable loan, unguaranteed, not covered, free credit

Related Terms and Acronyms

  • Collateral Definition,
    • Any property pledged as security for repayment of a debt.
  • Line of Credit (LOC) Acronym,
    • A commitment by a financial institution to lend up to a specified maximum amount to a customer during a specified period of time.
  • Loan Definition,
    • Letting another party use something of value temporarily.
  • Loan Shark Definition,
    • A lender that provides loans at usuriously high interest rates, often ensuring repayment with the threat of force.
  • Non-recourse Debt Definition,
    • A loan secured by collateral where the borrower is not personally liable.
  • Payday Loan Definition,
    • A short-term loan with an extremely high interest rate.
  • Personal Loan Definition,
    • A loan made for personal, family, or household use as opposed to a business-type loan or a long-term mortgage loan to finance real estate.
  • Secured Debt Definition,
    • A debt that is secured by a lien on debtor's property that may be taken by the creditor in case of non-payment by the debtor. A common example is a mortgage loan.
  • Secured Loan Definition,
    • Borrowed money that is backed by collateral.
  • Security Definition,
    • A tradable financial implement that represents ownership, the rights to ownership or debt.
    • Property designated as collateral.
    • A document stating ownership of a stock or bond.
  • Title Loan Definition,
    • A loan that uses a car as collateral.
  • Unsecured Debt Definition,
    • Debt that is not guaranteed by the pledge of any collateral. Most credit cards are unsecured debt, which is a main reason why their interest rate is higher than other forms of lending, such as mortgages, which employ property as collateral.
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