Business, Legal & Accounting Glossary
An unsecured creditor is a creditor other than a preferential creditor that does not have the benefit of any security interests in the assets of the debtor.
This refers to a person who is owed money by an organisation but who have not arranged that in the event of non-payment specific assets would be available as a fund out of which that person could be paid in priority to other creditors.
An unsecured creditor is an individual or institution that lends money without obtaining specified assets as collateral. This poses a higher risk to the creditor because it will have nothing to fall back on should the borrower default on the loan.
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This glossary post was last updated: 6th January, 2020 | 0 Views.