Secured Transactions - Perfection

Question 1

Perfection of security interest

Answer 1

gives secured party greater rights than third parties in collateral

Question 2

A security itnerest is perfeected upon attachment and must comply with one of the four methods of perfection

Answer 2

• filing financing statement
• possession collateral (tangible collateral)
• controlling collateral (deposit accounts)
• automatic perfection

Question 3

Filing a financing statment give

Answer 3

notice of the existence of the security interest

Question 4

financing statement must contain

Answer 4

debtor’s name, secured party’s name and description of collateral

Question 5

Debtor’s name

Answer 5

identified by name on debtor’s current driver’s license or state issued identification card

Question 6

a registered organization must be identified by the name shown on

Answer 6

public organic records

Question 7

if error in debtor’s name makes financing statement misleading, statement not effective unless a

Answer 7

search under debtor’s correct name would disclose the statement

Question 8

when debtor’s name changes, the secured party has

Answer 8

4 months to amend financing statement

Question 9

financing statement can include what type of description of collateral

Answer 9

super generic description of collateral

Question 10

The debtor must authorize financing statement in an authenticated record, but it doesn’t need to

Answer 10

sign financing statement

Question 11

an ipso facto authorization

Answer 11

occurs when debtor’s authentication of security agreement serves as authorization to file the financing statement

Question 12

Collateral related to real property requires filing in

Answer 12

the office for recording a mortgage on the real property (local filing)

Question 13

other collateral requires filing with the

Answer 13

secretary of state of debtor’s location (central filing)

Question 14

The filing office incorrect indexing of a financing statement does not affect

Answer 14

perfection

Question 15

filing office refusal to accept financing statement whether refusal was

Answer 15

justified or unjustified

Question 16

Refusal of financing statement as justified (failure to pay a fee) / how is it treated?

Answer 16

not been filed

Question 17

Refusal of financing statement as unjustified / how is it treated

Answer 17

treated as having been filed and statement is effective

fs effective for 5 years even though there is no ovlifation secured by collateral and no commitment to make an advance

Question 18

Security interests in tangible collateral may be perfected if the secured party _________.

Perfection exists only during the period of _________.

Answer 18

takes possession of collateral

Question 19

A secured party may perfect security interest in intangible collateral by

_______

perfection exists only while secured party __________

Answer 19

taking control of collateral , retains control

Question 20

What is the only method of perfection for letter of credit rights and deposit accounts?

Answer 20

taking control of the collateral

Question 21

A secured party has control over a deposit account if

Answer 21

• the s**ecured party is the bank **that maintain deposit account
• bank, secured party, and debtor agree in writing that secured party has control
• or secured party becomes bank’s customer with regard to the deposit account

Question 22

Some collateral will automatically ____ when the security interest attach

Answer 22

perfect

Question 23

A purchase money security interest in consumer goods is ______________.

A secured party does not need to file a financing statement to _______.

Answer 23

automatically perfected upon attachment , perfect

Question 24

Temporary perfection

Answer 24

may be available if a security itnerest was perfected but the debtor/collateral has changed since perfection occured

Question 25

temporary perfection -> if new value is given under authenticated security agreement,

Answer 25

a security interest in certified securities, negotiable documents, or instruments is automatically perfected for 20 days

Question 26

temporary perfection -> if collateral is delivered to debtor for them to sell/exchange it,

Answer 26

the security itnerest in collateral remains temporarily perfected for 20 days

Question 27

temporary perfection -> if debtor moves to another state

Answer 27

4 month grace period for perfected security interest to be refiled in new state

Question 28

temporary perfection -> if collateral is transferred to a debtor in another state, a perfected possessory security interest remains perfected when security interest

Answer 28

1 year grace period for a perfected security interest, perfected under new state laws

Question 29

a security interest stops being perfected upon the

Answer 29

expiration of the temporary perfection period

Question 30

when property is subject to a special statute instead of article 9, the statute dictates the

Answer 30

manner of perfection

Question 31

a certificate-of-title statute requires

Answer 31

that vehicles note a security interest on the certificate of title. If not, the filing is insufficient.