As a Chester County bankruptcy lawyer, I often get asked the difference between a secured creditor and an unsecured creditor. Here's a short response:
Secured Creditor: creditor whose claim against a debtor is secured by a valid (meaning, a contract or a legal note recorded at the courthouse) mortgage, lien, or other security interest against property that is owned by the debtor. This is typically a home mortgage, a car loan, or a boat loan.
Unsecured Creditor: A creditor whose claim against the debtor is not secured by a valid mortgage, lien or security interest against the debtors property. This is typically a credit card, personal loan, or medical bill.
In general, a secured creditor has the ability to collect all or a portion of its claim from its collateral (the property), while an unsecured creditor may not do so (there is nothing to "attach" to).
Frequently, a secured creditor may be owed more than the property to which it secures. This makes sense -- think about it, you've probably heard that a person owes more on their car the minute it is driven off the lot. In a Chapter 13 case, the debt with a secured creditor is divided between a "secured" and "unsecured" claim. The only exception is a mortgage company whose mortgage is on the debtor's home.