What is typically necessary for a loan to be secured?

For a loan to be secured, it is essential to have a lien on the property being financed. This means that the lender has a legal right or interest in the property until the loan is repaid. The lien serves as collateral for the loan, allowing the lender to reclaim the property through foreclosure if the borrower defaults on the loan. This mechanism is what differentiates secured loans from unsecured loans, where no specific asset is tied to the loan.

While factors such as a high credit score and a valid employment record can influence the terms of a loan or approval, they do not directly create a secured loan. A personal guarantee may enhance a lender's confidence in the borrower's commitment but does not provide the same legal claim on the property as a lien does. Thus, a lien on the property is fundamental to the nature of a secured loan, making it the correct choice.