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The law relating to perfection of security interests by taking of possession can sometimes be confused with the law relating to the granting of security interests, which provides that the deposit of certain assets (usually documents of title) can amount to an equitable mortgage of the goods. [7]
In finance, a security interest is a legal right granted by a debtor to a creditor over the debtor's property (usually referred to as the collateral [1]) which enables the creditor to have recourse to the property if the debtor defaults in making payment or otherwise performing the secured obligations. [2]
A security interest becomes enforceable against the collateral as soon as it attaches. Attachment requires three things: (i) that the debtor have rights in the collateral or the power to convey rights; (ii) that value be given; and (iii) in most cases, that the debtor have authenticated a security agreement that adequately describes the collateral.
Another example of collateral for a security interest would be the car if someone takes out a car lien to help cover the costs. [15] The law treats differently those creditors who are secured (i.e. have an authenticated, perfected security interest) from those creditors who are unsecured. An unsecured creditor is simply a person who is owed ...
A UCC-1 financing statement (an abbreviation for Uniform Commercial Code-1) is a United States legal form that a creditor files to give notice that it has or may have an interest in the personal property of a debtor (a person who owes a debt to the creditor as typically specified in the agreement creating the debt).
The interest rate that causes demand for savings to equal demand for investing, is typically denoted as R*. In theory, that perfect rate exists in the real world.
In order for a security interest to attach to the collateral in the possession of subsequent purchasers, it must be perfected. If the security agreement is for a purchase money security interest in consumer goods, perfection is automatic. Otherwise, the lender must record either the agreement itself, or a UCC-1 financing statement, in an ...
A personal loan may offer a cheaper way out of tax debt if you can meet 3 key criteria. Learn the benefits and drawbacks — including alternatives — in this comprehensive guide.