The only difference between secured debt and unsecured debt is that you have pledged some type of real property or valuable to be surrendered in the event that you are unable to meet the terms of the agreement. Many people think that only car loans or mortgages are secured but any type of debt can have security. Purchase Money Security Interests (PMSI) are held when you use the amount of credit extended to purchase an object such as furniture, jewelry, or home improvements.

If payments are not made promptly on a secured debt, the security (pledged item) can be repossessed. This type of debt can be included in a DMP but you must make certain your Account Manager is aware of the security interest to assure that the debt receives priority treatment.