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this tutorial is to give come an overview of what we call secured transactions secured transactions arise under Uniform Commercial Code article 9 article 9 was revised just a few years ago so all of the rules that apply to secured transactions are a little bit new and updated a secured transaction is basically a transaction where someone is making a loan and securing the loan by using collateral so well talk more about some definitions that go with those things now first of all if somebody often a bank wants to make a loan to someone else they want to do whats called create and perfect their security interest in the collateral so the first step is the creation of the security interest and the steps here are basically not the well theres a couple options one is that the creditor the person making the loan has possession of the collateral an example of this would be a pawnshop so if you take your watch to the pawnshop give them the watch and borrow money from then they give you cash t