Final answer:
A secured note payable is a type of long-term debt secured by collateral, such as property or equipment, which a lender can seize and sell if the loan is not repaid.
Step-by-step explanation:
A secured note payable is a long-term debt that is backed with a security interest in specific property. This property acts as collateral which means that it is something valuable—often property or equipment—that a lender would have a right to seize and sell if the borrower does not repay the loan. Collateral provides a safety net for lenders since it reduces the risk associated with lending large sums of money. This property acts as collateral which means that it is something valuable—often property or equipment—that a lender would have a right to seize and sell if the borrower does not repay the loan. Collateral provides a safety net for lenders since it reduces the risk associated with lending large sums of money.