Final answer:
A loan that allows a lender to take an item like a computer as collateral if payments are missed is known as a secured loan.
Step-by-step explanation:
If you agree to allow the lender to take your computer in the event you fail to make payments, the loan is categorized as secured. A secured loan is one that is backed by collateral, which in this case, is the computer. Should you default on the loan, the lender has the right to take possession of the collateral to recoup the losses. This is different than an unsecured loan, where no collateral is required, and the lender cannot claim assets directly if payments are missed. Amortized loans refer to loans that are paid off in equal installments over time, including interest and principal repayment, while interest-free loans do not charge any interest on the borrowed amount.