What is Unsecured Debt?
Get Your Free Case Review

What is Unsecured Debt?

by | Apr 13, 2015 | Bankruptcy

Whether in a news item, an article or a billboard advertisement, you have probably seen the terms secured and unsecured debt in relation to bankruptcy. As a core concept in bankruptcy, the division between secured and unsecured debt is not always as clear as debtors would hope. Depending on your situation, your amount of secured versus unsecured debt can help you choose between a Chapter 7 and Chapter 13 bankruptcy filing.

The main difference between secured and unsecured debt is the notion of collateral. If the debt is directly tied to physical property, then that debt is said to be secured. A creditor can, potentially, reclaim that property if you fail to pay your debt. The distinction, however, is not perfect. Past due taxes, for example, can be eliminated through bankruptcy only if certain conditions are met. In most instances, though, tax debt is considered secured even though there is no physical property.

Depending on your unique situation, an experienced bankruptcy attorney can provide clear direction regarding the benefits of seeking debt relief and what might happen to your debts. Unsecured debts can include:

  • Credit card debt
  • Department store charge cards
  • Utility bills
  • Medical bills
  • Personal loans

In some situations, as noted before, income tax debt might be discharged. Again, it is crucial to work with a knowledgeable attorney before making any life-altering financial decisions.

– Why Hire Nicolet Law? –

Get An Experienced Lawyer On Your Case

We’ve helped thousands of clients with a wide range of legal needs. Let us put the skills and experience we’ve gained along the way to work for you!

Get Our App!

Get our convenient, secure app to
send us legal documents and pay your bill. Available on the App Store and Google Play.

Download the Nicolet Law Office app from the App Store to conveniently send documents and issue payments to our attorneys.
Nicolet Law clients can conveniently send legal documents and issue payments through our secure app. Get it on Google Play.

More Than

Million Recovered for our clients

Over

Clients Helped

More Than

Years In business

Over

Years of Combined Experience

What Our Clients Say About Us

powered by BirdEye

Awards & Recognition

Our peers and independent third-party organizations have recognized the hard work and dedication we put into every case. This has led to numerous awards and accolades.

From Our Blog

Halloween Safety Tips

There is no doubt that Halloween is going to look a little different this year. Typically enjoyed by people of all ages...

Step-by-Step Guide for Filing a Personal Injury Claim

Imagine that you are driving to the grocery store on a Sunday afternoon when another car suddenly strikes the left side of...

Lost Wages Assistance and Disability Benefits

The coronavirus and resulting economic crisis have left millions of Americans in financial distress, and individuals with...

Stranger Than Fiction: Only in Wisconsin

In 2016, the Wisconsin Supreme Court barred a woman from suing a state employee whose negligence resulted in bodily injury...