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Flashcards in Security Interests: Rights Deck (3)
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Creditors Rights Upon Default

Proceed under UCC or judicial proceeding
Right to require the debtor to assemble
Right to render the collateral unusable to debtor
Right to pursue self-help remedy of repossession
- peaceful repossession
- without: trespassing, assault/battery, breaking & entering
Right to pursue judicial process
Rights on disposal of repossessed collateral:
- Keep Collateral
- send notice to debtor and junior interests
- no objection within 20 days
- Must Sell
- if consumer goods
- if 60% purchase price has been paid
Right to Sell Collateral
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Right to Sell Collateral

- Time: within 90 days of taking possession (or tort of conversion or any loss to debtor)
- Reasonable Manner: public or private, must give debtor notice of reasonable time and place of disposition
- secured party can disclaim disposal warranties
- secured party can "buy" if public sale


Distribution of Proceeds

1. Expenses of secured party
2. Balance of Debt
3. Junior Lien Holders
4. Debtor
**creditor may collect from debtor deficiency in sale funds**
**after debtor moves, 1st creditor has superiority but must file in new state within 4 months to keep it**

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