SecTrans2 Outline 2

SecTrans2 Outline 2 - Secured Transactions What is the...

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Secured Transactions What is the nature of an Article 9 Security Interest? Know the following terms about Security Interests in Personal Property : Debtor; Secured Party Collateral (be able to classify collateral: inventory, equipment, accounts, cash, neg. instruments, consumer goods, intellectual property) Security Interest: an interest taken by a creditor/lender who then becomes a secured party in personal property (collateral) that secures payment or performance of an obligation. Secured Transaction: when a creditor makes a loan to a debtor in exchange for the debtor’s pledge of personal property as security. Art. 9 of the UCC governs. There are two basic TYPES of Secured Transactions: 1. The creditor takes possession of the collateral. The lender has possession of the collateral and so they are secure that they are not taking on much risk in their loan. If the debtor fails to repay then the creditor can sell the collateral. How create?
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