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Secured Transactions Introduction

Secured Transactions Introduction. Secured Transactions – Basic Idea. A person wants property (real or personal) or services but does not have money. Person needs to become a debtor. Secured Transactions Creditor Options. 1 . Refusal. Secured Transactions Creditor Options.

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Secured Transactions Introduction

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  1. Secured TransactionsIntroduction

  2. Secured Transactions – Basic Idea • A person wants property (real or personal) or services but does not have money. • Person needs to become a debtor.

  3. Secured TransactionsCreditor Options • 1. Refusal

  4. Secured TransactionsCreditor Options • 2. Obtain promise to repay • Unsecured creditor • General creditor

  5. Secured TransactionsCreditor Options • 3. Obtain surety • Co-signer • Accommodation party • Guarantor

  6. Secured TransactionsCreditor Options • 4. Obtain Collateral • Real property = mortgage or deed of trust

  7. Secured TransactionsCreditor Options • 4. Obtain Collateral • Personal Property = Article 9 security interest

  8. Basic Approach • 1. Is the transaction within scope of Article 9?

  9. Basic Approach • 2. Classify the collateral.

  10. Basic Approach • 3. Determine if a security interest has been created, that is, has attachment occurred.

  11. Basic Approach • 4. Determine if the security interest has been properly perfected.

  12. Basic Approach • 5. Determine the persons who are making claims to the collateral.

  13. Basic Approach • 6. Apply proper priority rules and rules regarding repossession.

  14. Very Brief History

  15. Benedict v. Ratner – p. 756 Loan of money Hub Carpet Ratner Debtor Creditor Benedict Bankruptcy Trustee Issue: Who has priority to the accounts receivable? Accounts receivable as collateral

  16. Pre-Code Security Devices • 1. The pledge • DR gives CR physical possession of the collateral. • Pros? • Cons?

  17. Pre-Code Security Devices • 2. Chattel Mortgage 360 Financial Services Queensland, Australia

  18. Pre-Code Security Devices • 3. Conditional Sale • Problem 262, p. 761

  19. Pre-Code Security Devices • 4. Trust Receipt

  20. Pre-Code Security Devices • 5. Factor’s Lien

  21. Pre-Code Security Devices • 6. Field Warehousing

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