What Are Unsecured Debts?
Many common types of debt are considered unsecured. In basic terms, this means that there is not any property a creditor can automatically repossess or foreclose on to secure the debt. However, that does not mean that unsecured debts are harmless for a person’s finances. In fact, many of the most common forms of debt that push a debtor into bankruptcy are unsecured debts.
If you feel like your financial options have run out, it may be time to turn to bankruptcy as a way out of your debt. To learn more about how this powerful debt solution may be able to help you get a fresh start on your finances, contact the Joliet bankruptcy lawyers of Law Offices of Stuart B. Handelman, P.C., by calling 815-722-2201.
Examples of Unsecured Debts
When a person does not pay an unsecured debt, they will not typically lose property as a direct result. However, a creditor may still take action against a debtor. If a creditor can secure a court judgment, they may garnish wages or take other actions against the debtor. Debts that qualify as unsecured debts generally include the following:
- Student loan debts
- Credit card debts
- Medical costs
- Loans that were not secured to collateral property
- Income taxes in some cases
In bankruptcy, these debts are often given secondary priority to secured debts. This is due to the complications of foreclosure and repossession. There are some exceptions that specifically protect certain unsecured debts, however. For example, student loans are not dischargeable.
If you have been pushed to the point of being unable to pay back your unsecured debts, bankruptcy may be a sensible choice for you. For more information about how to begin the process of filing, contact the Joliet bankruptcy attorneys of Law Offices of Stuart B. Handelman, P.C., at 815-722-2201 today.