Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

REG Law > Secured Transactions > Flashcards

Secured Transactions Flashcards

You may prefer our related Brainscape-certified flashcards:
Civil Procedure 1L flashcards MBE flashcards MPRE flashcards
1
Q

This is a word for personal property/possessions other than real estate

A

Chattels

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Secured transactions are when debt is secured by ____

A

Chattels

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

This is a creditor who advances money or credit to enable a debtor to obtain collateral and then the creditor takes a security interest in that collateral

A

a Purchase Money Security Interest (PMSI) Creditor

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

a Non PMSI creditor gives you a loan and takes a security interest in what?

A

EXISTING collateral, not the item purchased with the loan

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

This is when a creditor takes as collateral property to be acquired by the debtor at later date

A

After Acquired Property Clause

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

an After Acquired Property Clause is used most often with ______ & ________

A

Inventory

Equipment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

_________ creates a secured transaction

A

Attachment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What are the 3 elements of attachment? (DR AV)

A

D - Debtor must have Rights in the collateral
A - Agreement between creditor & debtor (written/oral)
V - Value must be given by the creditor to the debtor

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

When can an agreement be oral?

A

Only if the creditor takes possession with the debtor’s agreement (pledge)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

T/F

When the agreement is written it must be signed by both the debtor and the creditor

A

FALSE

It need only be signed by the debtor

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

T/F

Attachment can occur if at least 2 of the 3 elements have been met

A

FALSE

All three elements must be met

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

________ is the creditor’s rights vs. subsequent 3rd parties. It means that the 1st creditor gives notice to all other creditors that he has 1st rights to the collateral.

A

Perfection

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

If a creditor is unperfected, then the creditor is _____

A

Unprotected

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What are the three ways for a creditor to be perfected?

A

1) Perfection by creditor taking possession of collateral
2) Perfection by filing a financing statement
3) Perfection by attachment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What is the only way to perfect with negotiable instruments, stocks, or bonds?

A

Perfection by creditor taking possession of collateral

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What is the only way to perfect with accounts receivable? Why?

A

Filing a financing statement

Because A/R is intangible so the creditor cannot take possession of the collateral

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

What must be included in a financing statement?

A

1) Names and addresses of parties
2) General description of collateral
3) Signature of debtor

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What perfection method can only occur with PMSI Creditors in consumer goods?

A

perfection by attachment

19
Q

One who perfects by attachment beats ______

A

All other creditors

20
Q

One who perfects by attachment loses ______

A

collateral to any consumer purchaser (innocent purchaser who has no idea of an attachment) who purchases the collateral from the debtor

21
Q

How can a creditor protect against losing collateral to an innocent purchaser when they are perfected by attachment?

A

They can protect against the loss by filing a financing statement

22
Q

Usually a perfected creditor beats a purchaser from debtor. What are the 2 exceptions?

A

1) One who perfects by attachment loses to purchaser without notice (filing a financing statement)
2) One who buys from a merchant in ordinary course of business takes free of all security interests

23
Q

T/F

When one buys from a merchant in ordinary course of business, they take free of all security interests unless they had notice of the security interest

A

FALSE

When one buys from a merchant in ordinary course of business, they take free of all security interests EVEN IF they had notice of the security interest

Example: When I buy from Macy’s, Macy’s creditors can’t pursue me if Macy’s defaults, no matter what.

24
Q

Usually the first creditor to file or perfect wins (1st in time, 1st in line). What are the 2 exceptions?

A

1) PMSI creditor in non-inventory collateral has priority if they file within 20 days of the debtor getting possession, even if a Non-PMSI files a financing statement first
2) PMSI creditor in inventory collateral has priority if before the debtor gets possession they file and give written notice to creditors ahead of him

25
Q

When a PMSI creditor in non-inventory collateral is trying to gain priority in perfecting, the must file within ______ of the debtor getting possession

A

20 days

26
Q

T/F

A PMSI creditor in non-inventory collateral cannot gain priority in perfecting if a non-PMSI files a financing statement first

A

FALSE

PMSI creditor in non-inventory collateral has priority if they file within 20 days of the debtor getting possession, even if a Non-PMSI files a financing statement first

27
Q

T/F

A PMSI creditor in inventory collateral can get priority in perfecting as long as they give notice to the other creditors

A

FALSE

PMSI creditor in inventory collateral has priority if BEFORE the debtor gets possession they file AND give written notice to creditors ahead of him

28
Q

What are the 3 remedies of a creditor after the debtor defaults?

A

1) Repossess the collateral
2) Strict Foreclosure
3) Sue the debtor

29
Q

When a creditor peacefully repossess the collateral and puts it up for sale at a public sale, the creditor (can/cannot) ______ bid on the collateral to get it back

A

CAN

30
Q

When a creditor peacefully repossess the collateral and puts it up for sale at a private sale, the creditor (can/cannot) ______ bid on the collateral to get it back

A

CANNOT

31
Q

T/F

After a creditor peacefully repossess the collateral and sells it, the debtor is liable for any deficiency but isn’t entitled to any surplus

A

FALSE

They are liable for any deficiency but also are entitled to any surplus

32
Q

This is the remedy of a creditor after the debtor defaults where the creditor keeps the collateral but cancels the debt

A

Strict Foreclosure

33
Q

T/F

In a strict foreclosure, the creditor must get an appraisal on the collateral and then considers that amount against the debt - the debtor is liable for any deficiency and is entitled to any surplus

A

FALSE

In a strict foreclosure the creditor keeps the collateral and must cancel the ENTIRE debt

34
Q

If the debtor or other creditors with to object to a strict foreclosure, how much time do they have to make their objections known?

A

21 days

35
Q

T/F

The debtor or other creditors can force a creditor to sell the collateral instead of choosing the strict foreclosure remedy

A

TRUE

Note that the debtor and other creditors must voice this within 21 days

36
Q

If the debtor has paid __% or more of the price of consumer goods, the creditor must sell unless the debtor specifically waives this right

A

60%

37
Q

This remedy is often used if collateral is insufficient to pay the debt owed

A

Suing the debtor. This is called a deficiency judgment

38
Q

A trustee may set aside transfers made within ___ prior to the filing of the bankruptcy petition if these transfers were made with intent to _____ any creditor.

A

One year

Hinder, delay, or defraud any creditor

39
Q

T/F

When a trustee sets aside transfers made within one year prior to the filing of the bankruptcy petition, the trustee must first consider the solvency of the debtor at that time

A

FALSE

The debtor need not be insolvent at the time of transfer

40
Q

A trustee may also set aside transfers made within one year prior to the filing of the bankruptcy petition if the debtor received ________ value in exchange for such transfer or obligation and the debtor was ______ at the time or ______ as a result

A

Less than a reasonably equivalent value

Insolvent at the time or became insolvent as a result

41
Q

A trustee may set aside preferential transfers of nonexempt property to a creditor made within ____ prior to the filing of the petition. What is the exception?

A

90 days

Up to 1 year for preferential transfers made to insiders

42
Q

This action is made for preexisting debts that enable the creditor to receive more than s/he would have otherwise under a Chapter 7 liquidation proceeding

A

Preferential Transfers

43
Q

What is a contemporaneous exchange?

A

An exchange between a creditor and debtor whereby the debtor receives new, present (i.e. contemporaneous) value.

REG Law (12 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions