1.1 secured transaction 担保交易and security interest担保权益
Debtor - Creditor(Security Party)
(Credit want to rely on something other than debtor’s promise to ensure payment)
Security Interest on Collateral, a limited right in specific personal property
(If default, self-help without judicial process)
1.2 Attachment(设立担保物） and perfection（完善）
- Attach the interest
- Perfect the security interest(Gain rights over third parties)
1.3 Scope of Article 9, secured transactions
UCC: Applied to personal property or fixtures, and outright sales of accounts receivable
Do NOT apply to: Land, wage claims, statutory liens(mechanics’s liens)
PMSI(Purchase Money Security Interest) - Has priority over all other type of security interests in the same collateral, if PMSI is properly perfected.
1. Retaining a security interest for the purchase price(a creditor sells the collateral to the debtor)
2. The Creditor advances funds used by the debtor to purchase the collateral.
1.4 types of collateral
Goods, Intangible and semi-intangible, investment property, and proceeds
2. Creation(Attachment) of the security Interest
- Agreement
- (Creditor) Lend money/Sell on credit
- Debtor has right to collateral
3. Perfect of the Security Interest
(Five Method)
- Filing
File with state (Financing statement:
Debtor’s/Credit’s Name & Address; Type of collateral)
(Debtor must sign security agreement if any)
- Taking possession of the collateral(Pledge)
- Control
- Automatic perfection
* PMSI in consumer goods
*Small-Scale assignment of accounts
-Temporary perfection
20days temporary perfection(if Old collateral is sold)
3.6 Movement( 4-month grace period) Creditor must perfect in the new state within 4-month period.
4. Rights on Default
- Taking possession (peace)
- Sale
Proceeds - Expense, Security interest in the collateral in order of priority; Surplus to debtor.
4.2 Retention of collateral (Yes)
4.3 Debtor’s right of redemption( Pay all creditors in full)
4.4 Judicial Action(Reduction claim to judgement)
