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4 Cards in this Set
- Front
- Back
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PMSI
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A PMSI secures repayment of a loan or credit that enabled the debtor to buy the collateral
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Seller purchase money agreement
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Secured Party sells the debtor collateral on credit, taking back a purchase money security interest for the unpaid purchase price
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Lender purchase money security interest
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Lender lends the debtor funds that are used to purchase the collateral, taking back a purchase money security interest in the purchased collateral for the loan amount.
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Exam tip
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Bar exam, sellers often sell goods to the debtor on credit and may even have the debtor sign a promissory note, but if they do not also require the debtor sign a security agreement, they are just unsecured creditors with no security interest in the goods.
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