CPA UCC9-2 - SECURED TRANSACTIONS UCC 9 I. OVERVIEW:...

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SECURED TRANSACTIONS UCC 9 I. OVERVIEW: Defined: a debt secured by collateral. UCC 9 does not apply to mortgages or U.C.C. 9 enables a creditor, though a two-step process (attachment & perfection) to encumber (i.e., place a lien against) property of the debtor’s. The goal is to achieve secured or perfected status. This status will give the creditor superior rights in that collateral over virtually all other claimants. II. CLASSIFICATION OF COLLATERAL Under UCC 9 collateral must be categorized in order to determine how to perfect. NOTE: UCC 9 does not apply to liens/mortgages on REAL PROPERTY A. TANGIBLE PROPERTY NOTE: In order to categorize TANGIBLE property, look at the property’s use /purpose in the hands of the debtor . 1. CONSUMER GOODS: used primarily for personal, household, family use. 2. EQUIPMENT: property bought for use in a business. 3. INVENTORY: property of the debtor’s held for sale or lease. B. INTANGIBLE PROPERTY NOTE: Property which does not have a physical existence of its own, but there is written evidence of its existence. Includes: UCC 3 paper, investment securities, title documents, bills of lading, warehouse receipts, money. 1. MOST intangibles can only be perfected by POSSESSION (see below) 2. ACCOUNTS RECEIVABLE can only be perfected by FILING. III. ATTACHMENT
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NOTE: Attachment involves the K’ual agreement between the debtor and the creditor , whereby the debtor grants the creditor the right to encumber the debtor’s property. In order for attachment to occur, the following elements must be present: 1. The creditor must give (the debtor) VALUE. (Value is consideration, and usually involves the extension of the credit.
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This note was uploaded on 10/04/2011 for the course BUL 5332 taught by Professor Klintworth,n during the Fall '08 term at University of Central Florida.

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CPA UCC9-2 - SECURED TRANSACTIONS UCC 9 I. OVERVIEW:...

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