Although there are really only two types of debt, secured and unsecured, these can come in many forms.
An unsecured loan is a loan whereby you agree to make regular repayments to the lender until the loan, as well as all interest, is fully repaid. Non-payment of the loan can result in further fees and possibly court proceedings.
Common unsecured debts include;
Secured loans tend be when you borrow large sums of money, often from around £3,000 but usually more like £10,000. They are called a secured loan because the lender will want you to place something of high value as security against the loan, in case you can’t pay it back. This security will usually be your home to cover the amount. If you can no longer repay the loan, the lender will apply to courts and force you to sell your home to get back the money you owe them. There are often arrangement fees and other expensive charges when taking out a secured loan.
Along with secured debts, there are some other special debts that we cannot help people with, and the payment of which must be prioritised above others. These include;
- HP agreements
- Court fines
- TV licence arrears
- Student loans
- Child support arrears
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