Unsecured Debt: Unlike a mortgage or a car loan, credit card debt is considered "unsecured" debt. Since there is no collateral to collect if you default, a credit card company has the right to sharply increase your interest rate if you are late with even a single payment. In some cases, interest rates can more than double, causing many people with high balances to pay much more for the price of using unsecured debt over the long-term.