Sec Trans Flashcards
(10 cards)
Which of the following statements regarding goods is FALSE?
a - Goods can qualify as fixtures if they are attached to real property in such a way that an interest arises in them under real property law.
b - Unborn animals are characterized as goods.
c - The default category for goods that do not fit under any other classification is “inventory.”
d - The classification of goods can change if the principal use of the collateral changes.
c - Equipment = Goods that don’t fit into any of the other definitions (consumer goods, farm products, or
inventory). E.g. delivery vans, office equipment, and farm equipment
T or F? A financing statement is not required to mention proceeds or after-acquired property.
True
Which of the following types of collateral CANNOT be perfected by control?
Letter of credit rights
Electronic chattel paper
Investment property
Negotiable instruments
Negotiable instruments
After collateral is sold or otherwise disposed of, the secured party has an automatically perfected security interest in the proceeds for __________ days
20
“filed but unattached” security interest exception applies with regard to a contest between __________
a judicial lien creditor and the holder of an unperfected security interest
T or F?
b - If a secured party’s advance is made within 45 days of a creditor’s lien arising, the secured party has priority over the lien creditor.
c - If an advance is made more than 45 days after a creditor’s lien arises, the secured party’s advance is subordinate to the creditor’s lien unless the advance is made without knowledge of the lien or made pursuant to a commitment entered into without knowledge of the lien.
both are true
As a general rule, the buyer of collateral subject to a perfected security interest takes the collateral __________.
subject to the security interest, unless the secured party authorizes the sale free and clear of the security interest
In order to avoid the “garage sale” exception, the holder of an automatically perfected security interest can
Properly file a financing statement covering the goods before they are sold
As a general rule, a security interest in fixtures has priority over an interest in the real property with which the fixtures are associated if the security interest in fixtures is perfected by a fixture filing __________.
before the real property interest is recorded
Which of the following statements regarding acceptance of the collateral in full or partial satisfaction of an obligation is FALSE?
a- In a consumer transaction, a secured party can accept the collateral only in full satisfaction of the obligation.
b - A secured party may accept collateral in partial satisfaction of an obligation when the debtor does not object to the secured party’s proposal to accept the collateral within 20 days.
c - In order for a secured party to accept collateral in partial satisfaction of an obligation, the debtor must consent, after default, to the acceptance in an authenticated record.
d - In a consumer transaction, a secured party cannot accept the collateral in full satisfaction of the obligation once the consumer has paid back at least 60 percent of the debt or the value of the good unless the debtor consents after default
b
