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16 Cards in this Set

  • Front
  • Back
agreement that creates or provides for a security interest.
Basically, just a contract.
security agreement
personal property or fixtures obtained by a creditor secures payment or performance of an obligation.
security interest
party who holds a security interest in the collateral of the debtor.
secured party
the person who owes payment or has an obligation to perform under the security agreement.
with secured transactions, tangible personal property serves BLANK (property securing the promise to repay). This includes:
Consumer goods.
A note with security agreement built into it.
Chattel Paper
-An agreement in which debtor grants creditor a security interest in collateral
-The debtor must have rights in the collateral
-The creditor must give value to the debtor
A creditor gets protection against other creditors or purchasers of the collateral
perfecting the security interest
A security interest is not legally enforceable between the creditor and debtor until it becomes BLANK to one or more particular items of debtor’s property.
3 ways perfecting can be done:
By filing public notice (financing statement)with the Secretary of State;
By the creditor taking possession or control of the collateral (pledge); or
Automatic perfection in certain transactions, such as a purchase money security interest.
Financing Statement with the Secretary of State (see p. 591).
UCC 9-501 requires
Name(s) of the Debtor
Name of the Secured Party
A Statement indicating or describing the collateral covered by the financing statement.
certain collateral as security for the debt and transfer the collateral into the creditor's possession
When a seller retains a security interest until goods are paid for or when money is loaned to acquire goods and the lender takes a security interest in the goods
purchase money security interest (PMSI)
PMSIs in non-consumer goods are not automatically perfected.
Two common types of non-consumer goods:
Equipment used in a trade or business;
Inventory of the business.
In addition to property actually in the possession of the debtor, a security agreement can continue to cover new collateral or proceeds of collateral that has been disposed of
floating liens
3 floating liens
Automatically covered as of the time the security agreement attaches.
After-acquired Property
A security agreement may be drafted to grant a creditor a security interest in debtor’s after-acquired property.
Future Advances
Security agreements can cover extensions of credit if specified in a security agreement.