In a Chapter 13 bankruptcy, secured and unsecured loans are treated differently.  In a Chapter 13 bankruptcy, secured debts (i.e., loans with a security interest, such as a loan on a house, car, boat, trailer, etc.) are treated in different ways.

In some circumstances, a debtor will not have to pay the full loan balance of the asset in question, such as a car, boat, or piece of investment real estate.  In these circumstances, a debtor would only have to pay what the the collateral is worth, not what is owed on it (unless, of course, what is owed is less than the value of the collateral).  

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