The important Stuff/Secured Transactions Flashcards
Attachment means what?
Security interest created
Attachment test
(1) Security agreement
(2) Value
(3) Debtor has rights in the collateral
What is required for a secuirty agreement (attachment #1)
Written security agreement is required
A (must be evidenced by a record & intent to create a security interest)
B (must be authenticated by the debtor/signed)
C (must contain a description of the collateral – reasonably identify)
if not written could be control or pledge…
pledge
secured credior in possession of collateral and oral agreement..RARE)
Control
nonconsumer deposit account/electronic chattel paper/investment property (depends on the collateral)
Value (#2 in attachment)
value has been given: any consideration that is sufficient to support a simple contract. (ex. Promise, past consideration) Every debtor has value because every debtor promises to pay back loan.
Perfection
security interest is perfected if there has been attachment and if a financing statement covering the collateral has been properly filed
Financing Statement
UCC-1
What info is necessary in UCC-1
A UCC-1 is sufficient only if it (i) provides the name of the debtor; (ii) provides the name of the secured party; and (iii) indicates the collateral secured. UCC 9-502.
(PMSI)
Perfection with a Purchase Money Security Interest
types of PMSI
Type #1: The Seller—The seller sells personal property to the buyer partly or entirely on credit, and takes a security interest in the goods sold/purchased.
Type #2: The Enabler—A bank or other lender advances funds to the debtor to allow the debtor to purchase personal property, or the bank or other lender has an obligation to cover the cost of the items the debtor wishes to purchase (for example, the bank or other lender may pay the manufacturer or the distributor directly).
Repossession
