Question

Can I please have the answer and 400 words or more and preferably in your own words thank you

Steve owns a car. He decides that he needs a loan in order to improve his house, so he goes to Liv. He agrees to give Liv a security interest in the car in exchange for $4,000. Two weeks later he decides that he needs more money.

He goes to Dane. He gives Dane a security interest in the car in exchange for $10,000. Dane files a financing statement to perfect the interest. A week after that Liv does the same. Eventually, Steve defaults in his payments. The car is repossessed, and it is sold for $3,000. How much money will Dane receive? How much money will Liv receive?

Answer 1

In this Question it is given that Steve Take a Car loan total of $ 14000. Out of this he take

Loan from Liv :    $ 4000

Loan From Dane :   $10000

Steve Defaults in the payment of loan so, car is repossessed and sold for $ 3000

The question ask for the money Liv & Dane will receive from the amount realised

In this case concept of First Charge will applied

Thus , The total amount of $ 3000 will be paid to Liv because he hold First Charge on the car.

And Dane will not get any amount Irrespective of he files a financial statement to perfect the interest , Because it is irrelevant and does not matter.