Question

Business Law

In this module, you have learned about secured transactions, as well as when attachment and perfection occurs.

For this assignment, think of three items you personally have that involve a security. If you do not actually have any property in which another holds a security interests, list three items that you can envision having in the future, and complete the assignment as if you currently hold them.

• List the three items you chose. (2 pts)
• For each of the three items, explain if and when attachment occurred. (6 pts)
• For each of the three items, explain if and when perfection occurred. (6 pts)
• Explain the priority each of the creditors would have if you defaulted on your promise to pay. (6 pts)

Answer 1

The word that describes when a security interest becomes enforecable aganist the debitor. This is a prepared if the debtor defaults to take the collateral.

Requirement for attachment :

1. ​​Secured party gives the exact value.
2. The debtor has the power of transfer rights in the secured party.
3. The parties have the security agreement signed by the debtor.
4. The creditor has the possession of the collateral.

Perfection to the Security Interest :

As long as the agreement and payments are done between the creditor and debtor , the attachment is fine. The creditor will have total control on the goods and sell them to satisfy the obligation. Perfection is the way of declaring the security interest on the subject to the world. If the secured party claim on the collateral.

There are 5 principal components in Secured Law Transactions :

1. Nature of property.
2. Ways to create a security interest.
3. The Perfection of security aganist claim of others.
4. Priorities among the secured and unsecured creditors.
5. The rights the creditor has when the debtor defaults.

There are 5 ways a creditor may perfect the security interest :

1. Filling up the financial form and statement.
2. Retaining the possession of collateral.
3. Taking over on control on the possession.
4. Taking control temporarily basis.
5. Taking control automatically.

Perfection by Filling :

A financial statement is filed to perfect all security agreements to provide the rights on the possession

The contents in the financial statement are :

• Debtor's name.
• Secured party name.
• a Statement that indicates that financial details that covers all assets.
• The description of the real property to which the collateral realted to.

Temporary Perfection : This contains negotiable documents of goods when a security certificate that is delivered to debtor for sale , or when the exchange of presentation. collection or renewl of the possession.