Unsecured creditor

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An unsecured creditor is a creditor that does not have any specific guarantee (lien, pledge, mortgage) which allows it to be paid before other creditors from the proceeds of the sale of the debtor's assets. Only the debtor's present and future assets serve as a guarantee of payment of its claim. If an unsecured creditor is not paid, it may have the debtor's assets sold in order to be paid from the proceeds of the sale; however, it will be in competition with all the other creditors, particularly the preferential creditors.

 

Source: Service Public