BU451 Lecture Notes - Chattel Mortgage, Floating Charge, Secured Creditor
Document Summary
Consensual security interests give creditors collateral security (a right to take specified assets in satisfaction of the debt) Some security interests just arise from normal transactions, these are non-consensual security interests. Security establishes creditor"s priority relative to other creditors. Security is most often used just as an incentive to pay the money owing. Unsecured creditors may ultimately acquire security interest through court action to collect overdue debt (seizing assets) Secured creditor doesn"t need judgement, can proceed on their own to enforce rights over the security (like a self-help remedy) moreover, unsecured creditors generally can"t touch assets already subject to a security of another creditor (they have priority) Key: whether or not you are secured or unsecured. Mortgages (real property vs. this chapter which is personal property), leases (a security device on its own, while personal property is acquired on credit), consignments (indirect type of secured credit), other credit devices.