Discover which debt relief companies will provide you with honest and professional debt solutions. Here you can research all your options, ask questions, and decide which type of debt solution is right for you!Why is Credit Card Debt Unsecured?
Credit card debt is unsecured debt because nothing you own is used as collateral against that debt. In other words, your creditors do not have the ability to take anything from you if you are unable to repay that debt.
By contrast, if you take out a car loan from the bank, the bank will make you sign papers that give them the ability to take your car from you if you cannot make the monthly car payments. That is a secured debt - it is secured by the car. The bank will sell your car and use the cash to pay themselves back. This question was asked of me by a reader - here was my answer.
Credit card companies cannot take anything from you. All they can do is report you to the credit bureaus and hire a collection agency to come after you to collect the debt - therefore it is unsecured.
