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Glossary term

Secured Loan

Definition

A secured loan is backed by collateral — something the lender can take if you don't repay.

Technical definition

A secured loan is credit backed by a pledge of specific collateral, giving the lender recourse to that asset upon default.

Why it matters

Most farm lending is secured, which can mean better terms than unsecured borrowing but puts the pledged asset at risk.

Example

A loan backed by a tractor or land is a secured loan.

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