An Alabama secured promissory note is an agreement that serves to establish the payment terms of a loan that is protected via the inclusion of a security clause. Being “secured,” the borrower must put up one of their assets to serve as collateral. Should the borrower be unable to pay back the loan, the lender has the legal right to claim the borrower’s asset. Types of collateral often include a home, a personal vehicle, an investment, a savings account, and gold/silver. Secured loans are a popular option as they often come with lower rates and permit larger amounts to be borrowed.
Unsecured Promissory Note – The unsecured note enables the borrower to receive financing without collateral.