A non-recourse loan, in simple terms, is a type of loan secured by collateral, typically real estate, where the lender can seize only the collateral if the borrower defaults. In this arrangement, the lender cannot go after the borrower’s other assets or income to recover the remaining unpaid debt. Non-recourse loans are often used in real estate financing and can protect borrowers from further financial loss, as they are not personally liable beyond the value of the collateral, even if its value has declined.