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B Law 2 Unit 1 Ch 20
Secured Transactions
| Term | Definition |
|---|---|
| secured transaction | Any transaction in which the payment of a debt is guaranteed, or secured, by personal property owned by the debtor or in which the debtor has a legal interest. |
| secured party | A creditor who has a security interest in the debtor’s collateral, including a seller, lender, cosigner, or buyer of accounts or chattel paper. |
| debtor | Under Article 9 of the UCC, any party who owes payment or performance of a secured obligation. |
| security interest | Any interest in personal property or fixtures that secures payment or performance of an obligation. |
| security agreement | An agreement that creates or provides for a security interest between the debtor and a secured party. |
| collateral | Under Article 9 of the UCC, the property subject to a security interest. |
| financing statement | A document filed by a secured creditor with the appropriate official to give notice to the public of the creditor’s security interest in collateral belonging to the debtor named in the statement. |
| default | Failure to pay a debt when it is due. |
| attachment | In a secured transaction, the process by which a secured creditor’s interest “attaches” to the collateral and the creditor’s security interest becomes enforceable. |
| perfection | The legal process by which secured parties protect themselves against the claims of third parties who may wish to have their debts satisfied out of the same collateral. |
| pledge | A security device in which personal property is transferred into the possession of the creditor as security for the payment of a debt and retained by the creditor until the debt is paid. |
| purchase-money security interest (PMSI) | A security interest that arises when a seller or lender extends credit for part or all of the purchase price of goods purchased by a buyer. |
| continuation statement | A statement that, if filed within six months prior to the expiration date of the original financing statement, continues the perfection of the security interest for another five years. |
| proceeds | Under Article 9 of the UCC, whatever is received when collateral is sold or disposed of in some other way. |
| after-acquired property | Property that is acquired by the debtor after the execution of a security agreement. |
| cross-collateralization | The use of an asset that is not the subject of a loan to collateralize the loan. |
| floating lien | A security interest in proceeds, after-acquired property, or collateral subject to future advances by the secured party (or all three). The security interest is retained even when the collateral changes in character, classification, or location. |
| execution | The implementation of a court’s decree or judgment. |
| levy | The legal process of obtaining funds through the seizure and sale of nonexempt property, usually done after a writ of execution has been issued. |
| junior lienholder | A party that holds a lien that is subordinate to one or more other liens on the same property. |
| deficiency judgment | A judgment against a debtor for the amount of a debt remaining unpaid after the collateral has been repossessed and sold. |
Created by:
leighg2011
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