Flashcards in Secured Transactions Deck (6)
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1
Secured Transactions
When does a security interest attach; or become legally enforceable?
Secured interest must be supported by consideration given. Debtor must actually own the rights to the collateral or have possession. Secured interest much be recorded
2
Secured Transactions
What are the characteristics of perfection of interest in a secured transaction?
Gets higher priority over others claiming rights to collateral after the perfection takes place
Attachment must take place BEFORE perfection
3
Secured Transactions
How does perfection occur in a secured transaction?
By filing a financing statement
By possessing the collateral
4
Secured Transactions
When does automatic perfection occur in a secured transaction?
Store sells a consumer good on credit - Store retains security interest
A bank finances the purchase of a consumer good - Bank retains security interest
5
Secured Transactions
What are the priority rules for payment in a secured transaction?
If two parties are perfected; then the first one to file wins
If neither party is perfected; then the first one to attach wins
6
Secured Transactions
