Secured Transactions VC Flashcards
Does security agreement become enforceable when debtor signs contract?
NO
(a) [Attachment.]
A security interest attaches to collateral when it becomes enforceable against the debtor with respect to the collateral, unless an agreement expressly postpones the time of attachment.
(b) [Enforceability.]
(1) value has been given;
(2) the debtor has rights in the collateral or the power to transfer rights in the collateral to a secured party; and
(3) Debtor signed security agreement or orally agreed and collateral is in posession of secured party. In either case, creditor has an interest in the property
Does statute of frauds require security agreement to be in writing?
NO. But if it’s not, collateral should be in control of secured party
Required to be in writing:
contracts for the sale of an interest in land,
contracts for the sale of goods for $500 or more (under the U.C.C.),
contracts in consideration of marriage,
contracts that cannot be performed within one year of the contract being made,
contracts of suretyship,
contracts where an estate executor agrees to pay estate debts from his personal funds.
What must be included on financing statement
A financing statement requires
a listing or description of the collateral,
the signature of debtor
address of the debtor
name and address of the creditor.
How do you perfect a PMSI in nonconsumer goods?
File a financing statement or take possession of goods.
When does a PMSI in nonconsumer goods get perfected?
When secured party takes possession of goods OR
When financing statement is filed (for INVENTORY)
When goods are delivered (attachment) if Financing statement is filed within 20 days (for EQUIPMENT & GOODS OTHER than inventory, livestock)
