Applicability and definitions Flashcards
Article 9 of the UCC
Article 9 of the UCC applies to ANY transaction intended to create a security interest in personal property or fixtures (Not mortgages on real property). A security interest gives a creditor the right to sell a debtor’s property in order to satisfy a debt
Collateral
Generally, in an article 9 transaction, personal property or fixtures secure the payment of a debt or insure performance of a contract obligation with the property serving as collateral
Secured party
The secured party is the creditor who possesses the benefit of the the security interest
Debtor
The debtor is the party who has an ownership interest or other sufficient interest in the personal property securing the obligation
Obligor
The obligor is the party held responsible for the underlying obligation (Usually also the debtor, but could also be a type of guarantor)
what are the different types of collateral?
Goods- things that are movable when a security interest attaches.
Consumer goods -Goods that are used mainly for personal, family or household purposes
Inventory - goods that are kept by a person for sale or lease
accounts - covers any right too payment of a monetary obligation, whether or not earned by performance, for property that has been or is to be self (i.e accounts receivable)