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There are two types of debt: Unsecured debt and Secured debt.
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Unsecured Debt is when the debt not secured agaisnt any property or collateral, and on which the interest rate
can vary and is often high due to the risk of non-payment. Creditors can not seize your belongs if they go unpaid, but
your credit rating can suffer and you may be subject to lawsuits or possibly even wage garnishment.
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Examples of Unsecured debts:
- Credit card debt
- Medical bills
- Department store credit card debt
- Unsecured loans
- Personal loans
- Lines of credit
- Collections or repossesions
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Secured Debt is debt that is not typically alleviated through debt relief programs because its creditors
will not negotiate a lesser amount on what you owe. Usually with secured debt, there is a tangible asset, or
collateral, that a creditor can seize if you are unable to pay the debt.
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Examples of Secured debts:
- Home Mortgages
- Auto Loans
- Government Loans
- Student Loans
- Lawsuits
- IRS debt or back taxes
- Utility bills
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