What are the elements of a secured transaction?
The secured transaction always involves a debtor, a secured party, a security agreement, a security interest, and collateral. Article 9 applies to any transaction that creates a security interest. The UCC in Section 1-201(35) defines security interest.
Whats contained in a UCC security agreement?
A security agreement must contain a description of the collateral. UCC 9-108 requires that the description of the collateral provide reasonable identification of the property.
What are secured transactions under the UCC?
One of the most well known UCC provisions is the requirement of perfecting a security interest. In general, a secured transaction is designed to provide a lender with recourse in the event that the borrower is unable to repay the loan, primarily by taking possession of the asset and selling it.
Do security agreements need to be recorded?
Just like real estate deeds, security agreements should be recorded at state offices and made available to the public.
What are the elements of a security agreement?
Certain specific requirements are required for the security agreement to form the foundation for a valid security interest, namely 1) it must be signed, 2) it must clearly state that a security interest is intended, and 3) it must contain a sufficient description of the collateral subject to the security interest.
What is the description of collateral in a security agreement?
The Collateral consists of all of each Borrowers right, title and interest in and to the following personal property wherever located, whether now owned or existing or hereafter acquired, created or arising: All goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to
What are the contents of a security agreement?
A security agreement is a document that provides a lender a security interest in a specified asset or property that is pledged as collateral. Security agreements often contain covenants that outline provisions for the advancement of funds, a repayment schedule, or insurance requirements.
How do you perfect a security interest in a contract?
However, generally speaking, the primary ways for a secured party to perfect a security interest are: by filing a financing statement with the appropriate public office. by possessing the collateral. by controlling the collateral; or. its done automatically upon attachment of the security interest.