Types of security

Copyright © 2025 LexisNexis
Published by a LexisNexis Banking & Finance expert
Practice notes
In-house

Types of security

Copyright © 2025 LexisNexis

Published by a LexisNexis Banking & Finance expert

Practice notes
In-house

Lenders will often take security as support for a borrower's obligations under a loan. Taking security means that they will have certain rights over the secured assets in the event that the borrower fails to repay the loan.

This Practice Note provides an introduction to the key features of the four types of security recognised under English law. It also discusses what is meant by the difference between legal and equitable security interests and the difference between them.

Practice Note: Introductory guide to security in a lending transaction, provides a more general introduction to security in lending transactions and is a good starting point for those unfamiliar with the topic.

Practice Note: Security—frequently asked questions provides links to answers to some of the most frequently asked questions on security issues.

What is security?

A security interest confers rights in the security provider's assets in favour of the secured party as security for its own or a third party's obligation. The nature of the rights conferred by a security interest will depend on the type of security taken.

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Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Priority definition
What does Priority mean?

The ranking of security interests ie the order in which each of the secured creditors can claim on the secured property in an enforcement or insolvency scenario. A deed of priority or intercreditor deed can vary the priority a security interest enjoys by virtue of general law.

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