Secured transactions

Question 1

security interest attach

Answer 1

t. Attachment requires that: (i) the parties agree to create a security interest—evidenced by either an authenticated security agreement or the creditor’s taking possession or control of
the collateral, (ii) the debtor must have rights in the collateral, and (iii) the creditor must give value.
There is no requirement that the security agreement be filed. (Filing is related to perfection.)

Question 2

Under the Secured Transactions Article of the UCC, what would be the order of priority for the following
security interests in consumer goods?

Answer 2

When there are conflicting perfected security interests in the same collateral, the
first creditor to file or to perfect has priority. Here, “I” was filed first. “II” was next perfected by
possession. “III” was last to be filed or perfected

Question 3

Security Interest

Answer 3

The general rule is that a buyer takes subject to security interests in the goods bought, but one large exception to this rule is that any buyer from a merchant in the ordinary course of business usually takes free of a security interest previously given by the merchant.

Question 4

debtor default

Answer 4

When a debtor defaults, the secured creditor can proceed against the collateral,
but is not required to. Instead, the creditor can obtain a general judgment.