Secured Debt in Bankruptcy

If you are having trouble paying your mortgage and/or car loan, you may be considering bankruptcy. These types of secured debt can consume most of your monthly income, leaving little money left to pay your other bills. Bankruptcy may be a good choice. Speak with one of our lawyers to learn if it is right for you.

At Prescott Pearson & Tande, PA, we are committed to helping people in Minnesota find solutions to debt troubles. We can help you understand what debts are dischargeable and create a plan to get you the debt relief solutions you need. If you are worried about foreclosure, we can help you address that issue. We can also help you with vehicle repossession. Please call 651-968-8096 or 888-366-0827 to schedule a free consultation.

What Is Secured Debt?

Secured debt has collateral that secures the loan. Some of the most common types of secured debt include:

  • Mortgages
  • Second mortgages, home equity loans, home equity lines of credit (HELOCs)
  • Auto loans
  • Motorcycle and boat loans

With secured debt such as a car loan, the lender has the right to repossess the collateral (your vehicle) if you are no longer making payments on the loan. The same is true with a mortgage. If you stop making mortgage payments, your lender can foreclose and take your home.

In some cases, when the collateral is repossessed and liquidated, the lender does not recover enough money from the sale to cover its loss. This deficiency balance becomes an unsecured debt. Minnesota has an anti-deficiency statue if a mortgage is foreclosed by advertisement, but not if it is foreclosed by action, which is rare. For general secured debt such as a vehicle, there is no anti-deficiency statue and the lender can collect a deficiency balance.

Talk to a lawyer if you are facing these problems. We can examine your finances and help you determine what options are right for you.

"This Is All We Do, and We Do It Well."

Call for a Free Consultation Today

  • Minneapolis-St. Paul Area: 651-968-8096
  • Minnesota Toll Free: 888-366-0827

Please call us at the numbers above or contact us online to schedule a consultation.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.