1. Maureen has been struggling with a chronic illness for several years and has

Question

1. Maureen has been struggling with a chronic illness for several years and has recently needed increased treatments and medical attention. As a result, her medical bills have increased steadily. Are Maureen's medical bills secured or unsecured debt?

2.The Thompson family enjoys spending time outdoors and traveling to different campgrounds in their area. Because of this hobby, they have decided to purchase an RV that will allow them to expand their travels to sites around the United States. Would a loan for their RV be secured or unsecured debt?

3.Steve's uncle owns a classic car that has been secured under a protective cover for the past 15 years. Because he never takes the car out of the garage, the uncle has decided to sell the vehicle to Steve. Since Steve would have to take out a loan to pay for the car, would this be good or bad debt?

4. Sally and Jim recently moved into their first home. The down payment depleted their savings account, so the couple plans to apply for financing in order to purchase furniture. Is this good or bad debt?

Explanation / Answer

b. Unsecured debt a.Secured-RV itself will act as a mortgage b.Good Debt. Bad debt is one which cannot be recovered b.Good Debt. Furniture can be retrieved if loan amount not paid.

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