Blaw Test 3 Ch. 29

Front 1

agreement that creates or provides for a security interest.
Basically, just a contract.

Back 1

security agreement

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personal property or fixtures obtained by a creditor secures payment or performance of an obligation.

Back 2

security interest

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party who holds a security interest in the collateral of the debtor.

Back 3

secured party

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the person who owes payment or has an obligation to perform underthe security agreement.

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debtor

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with secured transactions, tangible personal property serves BLANK (property securing the promise to repay). This includes:
Consumer goods.
Equipment.
Inventory

Back 5

collateral

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A note with security agreement built into it.

Back 6

Chattel Paper

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Attachment

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-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

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A creditor gets protection against other creditors or purchasers of the collateral

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perfecting the security interest

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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.

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attached

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3 ways perfecting can be done:

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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.

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Financing Statement with the Secretary of State (see p. 591).
UCC 9-501 requires

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Name(s) of the Debtor
Name of the Secured Party
A Statement indicating or describing the collateral covered by the financing statement.

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certain collateral as security for the debt and transfer the collateral into the creditor's possession

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pedge

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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

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purchase money security interest (PMSI)

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PMSIs in non-consumer goods are not automatically perfected.
Two common types of non-consumer goods:

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Equipment used in a trade or business;
Inventory of the business.

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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

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floating liens

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3 floating liens

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Proceeds
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.