Unsecured debt is debt that is not collateral, which gives the creditor security in the event of default. If you cannot pay your company's unsecured debt, meeting the obligations can be critical to its survival. While credit card debt is often the most considered - of whatever kind - other unsecured debt includes mortgages, credit cards, and other forms of debt such as student loans, car loans, and student loans.

Unlike secured debt, unsecured debt does not include collateral, so nothing can be taken away from the debtor. Any debt not secured by any type of collateral will be treated as an unsecured claim pursuant to Chapter 13 of your bankruptcy plan. Unsecured debt is a priority in bankruptcy because, unlike most other unsecured debt, it has been paid in full.

In most cases, unsecured debt is credit card debt and the debt accrued after the debtor defaults is not recorded as debited, causing the loan or credit line to be forgotten. This type of loan default assistance occurs because it involves courts and foreclosure and repurchase proceedings, which are usually covered by papers signed at the time the loans are taken out. Unsecured creditors have no right to seize a debtor's property if they default on a loan.

An unsecured credit card does not require collateral, and the term of the debt depends on the amount of money available to the lender and the value of its collateral. Because the debt is unsecured, this type of debt is typically slightly riskier for the lenders who issue it. Browse how you can write off debts no matter what type of debt you have.

Bankruptcy can forgive many kinds of debt, but not all debts are replaceable. Unsecured debt is a type of debt that does not require tangible assets to maintain. Examples of unsecured debt include loans, credit cards, mortgages and other types of credit card debt.