CLD - Module 6 UCC Compliance

Question 1

Two components to creating a security interest:

Answer 1

Attachment

Perfection

Question 2

To attach a security interest, three conditions must be satisfied.

Answer 2

• The secured party has to obtain an authenticated, or signed, security agreement from either the debtor or a third party who owns the collateral, gains physical possession of the collateral, or has control of the collateral.
• The debtor has to either own the collateral or have the right to control the disposition of it. This is called rights in the collateral.
• The bank has to give some value in exchange for the security interest it obtains.