R7 - Business Law 2 (Secured Transactions) Flashcards
What is a secured transaction?
Debt secured by collateral
How does a creditor protect himself from a debtor?
Attachment
How does a creditor protect himself against third parties?
Perfection
What is the scope of UCC Article 9?
Applies to most contractual security interests in personal property or fixtures AND outright sales of accounts receivable
What does PMSI stand for?
Purchase money security interests
What is defined as a security interest that has priority over all other types of security interests in the same collateral, if properly perfected?
PMSI
Can a PMSI arise when a creditor sells the collateral to the debtor on credit, retaining a security interests for the purchase price?
YES
Can a PMSI arise when a creditor advances funds used by the debtor to purchase the collateral?
YES
If a debtor uses a car as a delivery vehicle for his business, what type of good is it?
Equipment
If a debtor uses a car for household purposes, what type of good is it?
Consumer good
If a debtor uses a car to sell at his auto dealership, what type of good is it?
Inventory
A requisite for attachment is an __________ record of the security agreement.
Authenticated
A requisite for attachment is the creditor’s taking _______ or control of the collateral (a pledge).
Possession
A requisite for attachment is that ____ must be given by the secured party in exchange for the security interest.
Value
A requisite for attachment is that the debtor must have ________ in the collateral (usually outright ownership, but it could be something less, such as possessory right under rental agreement).
Rights
