Unsecured

AAA

DEFINITION of 'Unsecured'

A loan or equity interest that is given without any guarantee of payment, performance, satisfaction or opportunity for return from the recipient. No property, interest or security is used as collateral in either a guarantee or a pledge.

INVESTOPEDIA EXPLAINS 'Unsecured'

Unsecured transactions are the most risky for the lending or selling party and least risky for the borrowing or buying party. Lenders or sellers are provided no compensation for default of payment or failed delivery of goods or services.

RELATED TERMS
  1. Bank Guarantee

    A guarantee from a lending institution ensuring that the liabilities ...
  2. Creditor

    An entity (person or institution) that extends credit by giving ...
  3. Debtor

    A company or individual who owes money. If the debt is in the ...
  4. Unsecured Creditor

    An individual or institution that lends money without obtaining ...
  5. Unsecured Loan

    A loan that is issued and supported only by the borrower's creditworthiness, ...
  6. Secured Debt

    Debt backed or secured by collateral to reduce the risk associated ...
Related Articles
  1. What Is A Corporate Credit Rating?
    Investing Basics

    What Is A Corporate Credit Rating?

  2. Are Structured Retail Products Too Good ...
    Options & Futures

    Are Structured Retail Products Too Good ...

  3. Lending Clubs: Better Than Banks?
    Options & Futures

    Lending Clubs: Better Than Banks?

  4. An Overview Of Corporate Bankruptcy
    Bonds & Fixed Income

    An Overview Of Corporate Bankruptcy

comments powered by Disqus
Hot Definitions
  1. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
  2. Due Diligence - DD

    1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to ...
  3. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  4. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  5. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  6. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
Trading Center