MCS 3040 Chapter Notes - Chapter 26: Secured Creditor, Security Interest, Subrogation

• School: University of Guelph
• Department: Marketing and Consumer Studies
• Course: MCS 3040
• Professor: Joe Radocchia

Document Summary

Secured credit debt where the creditor has an interest in the de(cid:271)to(cid:396)"s p(cid:396)ope(cid:396)t(cid:455) to se(cid:272)u(cid:396)e payment. Unsecured creditor c(cid:396)edito(cid:396) (cid:449)ith (cid:374)o se(cid:272)u(cid:396)it(cid:455) i(cid:374)te(cid:396)est i(cid:374) the de(cid:271)to(cid:396)"s p(cid:396)ope(cid:396)t(cid:455) Letter of credit w(cid:396)itte(cid:374) p(cid:396)o(cid:373)ise (cid:271)(cid:455) a (cid:271)u(cid:455)e(cid:396)"s (cid:271)a(cid:374)k to a selle(cid:396)"s (cid:271)a(cid:374)k to pa(cid:455) the selle(cid:396) (cid:449)he(cid:374) specified conditions are met. Events of default failure by the debtor to make required payments on a loan or to fulfill its other obligations under the credit agreement. Credit risk in international trade: overseas company may want payment before the goods are shipped, local company wants to pay once goods have been shipped. Letter of credit: (cid:449)(cid:396)itte(cid:374) p(cid:396)o(cid:373)ise (cid:271)(cid:455) (cid:271)u(cid:455)e(cid:396)"s (cid:271)a(cid:374)k to a selle(cid:396)"s (cid:271)a(cid:374)k to pa(cid:455) the selle(cid:396) (cid:449)he(cid:374) specified conditions are met. Collateral e(cid:272)u(cid:396)it(cid:455) fo(cid:396) a (cid:271)o(cid:396)(cid:396)o(cid:449)e(cid:396)"s p(cid:396)o(cid:373)ise to (cid:396)epa(cid:455) a loa(cid:374) Credit granting allows the lender to extract whatever promises of security.