What is Debt?
'''Debt''' is what someone owes to someone else. Usually, debt is in the form of [[money]], but it can also be [[wikt:item|items]], [[service (economics)|services]], favors, or other things. Thus if you make an [[agreement]] to give or do something for someone else, you now owe a debt. Unpaid debt can lead to problems such as the [[Greek government-debt crisis]].<ref>{{Cite web|title=Debt|url=https://www.investopedia.com/terms/d/debt.asp|access-date=2021-10-09|website=Investopedia|language=en}}</ref> Debt is used by governments, corporations and individuals to make purchases that they could not normally afford. Common types of debt owed by households and individuals are mortgage loans, car loans, credit card debt, and income taxes. In the case of individuals, debt is a way to use an anticipated income combined with the future purchasing power at present before earning the same. <ref>{{Cite web|date=19 May 2020|title=The Impact of Debt|url=https://extras.com.au/personal-finance-statistics-around-the-globe/|access-date=2021-10-09|website=Extras|language=en}}</ref> On the other hand, corporates have a multitude of options when it comes to debt. Companies may use debt for their working capital or day-to-day operations. == Types of debt == Goods, services or money borrowed with the intent of repayment (in kind or not) creates a debt. Debt can be classified as either secured debt, unsecured debt, revolving debt, or a mortgage. A secured debt uses ''collateral'', which is an [[asset]] that is [[promise]]d to the debt-holder until the debt has been repaid. If the repayment is not made in full, the lender gets the collateral asset. For instance, a car loan typically creates a secured debt. If you still owe money on the car loan and do not make timely payments, the note-holder can take back (or repossess) the car and sell it to get the money still due. A home [[mortgage]] is similar. An unsecured debt is more risky to the debt-holder (the lender, also called [[creditor]]). In the event of non-payment of the debt, th