Debt – Secured or Collateral #2

Once the lender has repossessed the asset the loan was against, many borrowers think that is the end of their relationship. That is not the case. The lender will sell the asset they repossessed and apply the sale proceeds, after deducting all costs of sale, against the total debt including all interest and penalties. The borrower still has to pay whatever is still owing. This debt is now an unsecured debt.