BLA 461 Lecture Notes - Lecture 3: Security Interest, Repossession, Promissory Note
Document Summary
Dealing with personal properties to act as collateral for a loan. Pmsi (purchase money security interest): when a store finances a new purchase, so you can buy a certain product. Promissory note: promise to pay the loan, no collateral. Status of attachment allows the secured party to seize the collateral if there is a default. It sets the rights between the debtor and the secured party. 3 things have to be present: secured party must give value, debtor must have an interest in the collateral, security agreement (pledge the collateral as security for the operation). Can be oral if the secured party takes possession of the collateral. Outsiders who might try to seize the collateral: 3 ways to perfect: file a (cid:498)financing statement(cid:499) Good for 5 years: perfection without filing, automatic perfection rule. Secured party takes possession of the collateral rule. If buyer defaults, the secured party will get the product back.
