Secured debt is a type of loan that is backed by collateral, which is an asset that the borrower offers to the lender. If the borrower fails to repay the loan, the lender has the right to take the collateral to recover their losses. Common examples of secured debt include mortgages and auto loans, where the property or vehicle serves as security for the loan. This type of debt typically has lower interest rates compared to unsecured debt because the lender has less risk. Since the loan is secured by an asset, borrowers may find it easier to obtain financing for larger purchases, making secured debt a popular choice for many individuals.