O’Bryan Law Offices represents Bankruptcy clients throughout all of Kentucky and Southern Indiana. We offer in-person and video/telephone consultations for people so they can understand their financial options from the comfort of their own home.
Call now for a FREE consultation!
Close this search box.

O'Bryan Blog


What Is the Difference Between Secured vs Unsecured Debt?

secured vs unsecured debt

For people who are thinking about filing for bankruptcy, one of the most important issues in your bankruptcy involves the types of debt you have incurred. There are two types of debt: secured vs unsecured debt. Secured debt refers to debts that are tied to a specific piece of collateral. For example, a mortgage or an automobile loan is a types of secured debt. If you fall behind on the payments, your lender has the right to take your home or your car.

Unsecured debts are debts that are not backed up by collateral. Examples of unsecured debts are credit cards, unpaid medical bills, and unpaid utility bills . While unsecured creditors cannot take your property, they can still sue you for any unpaid amounts. Once your creditors take a judgment against you, they can garnish your wages, bank accounts and take any number of actions to recover payment.

How does the type of debt you owe impact your bankruptcy? Understanding the difference between secured vs unsecured debt is a must. A knowledgeable Kentucky bankruptcy attorney can answer these questions and make all the difference in your situation. For more than 15 years, individuals and businesses across Hamilton County and Southwest Ohio and have turned to the law firm of O’Bryan Law Offices.

Kentucky and Southern Indiana Attorneys Taking On Unsecured Debt and Secured Debt Issues

Generally speaking, Chapter 7 bankruptcy will discharge most types of unsecured debt. Therefore, if your debts are primarily credit cards or medical bills, Chapter 7 may offer the debt relief you need. It is only possible to discharge certain types of debt under certain circumstances. Examples include taxes and student loans. However, it is not possible to discharger certain unsecured debts. One example is unpaid child support obligations.

If you are in default on your secured debts and file Chapter 7, your secured creditors may have the right to take the collateral. Therefore, if you have a home or automobile and want to keep it, you may be better off filing for Chapter 13 bankruptcy KY. Our law firm will give you clear, candid advice on whether bankruptcy is right for your situation. If bankruptcy is in your best interests, we will give you further advice as to what type of bankruptcy will maximize your debt relief. To better understand how secured vs unsecured debt affects your bankruptcy case, contact a Louisville bankruptcy attorney.

Contact the Louisville Bankruptcy Lawyers of O’Bryan Law Offices. We offer a free initial consultation. We also offer help from a Chapter 13 bankruptcy attorney. Call our Louisville office at 502-339-0222 or email us today.


Disclaimer: The use of the internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.