East Mississippi Community College ECON 2123 Chapter 34-SECURED TRANSACTIONS IN PERSONAL PROPERTY TRUE/FALSE 1)A security interest gives a creditor more protection than is afforded by a right to sue on the debt

East Mississippi Community College

ECON 2123

Chapter 34-SECURED TRANSACTIONS IN PERSONAL PROPERTY

TRUE/FALSE

1)A security interest gives a creditor more protection than is afforded by a right to sue on the debt.

2. A security interest is a property right that enables the creditor to take possession of the property if the debtor does not pay the amount owed.

3. The property that is subject to the security interest is called collateral.

4. In a security agreement, the creditor and the debtor agree that the creditor has a security interest.

5. A security interest may be possessory or nonpossessory.

6. A security agreement need not describe the collateral involved.

7. In most cases, value, which allows attachment of a security interest, is any consideration that supports a simple contract.

8. For a security interest to attach, the creditor must file a financing statement.

9. A debtor has sufficient rights in the collateral for a security interest to attach only if the debtor owns the collateral.

10. An after-acquired property clause in a consumer security agreement can cover only goods acquired by the debtor within thirty (30) days after the creditor gave value to the debtor.

11. Consumer goods are classified into different categories based on the debtor's intended use, not the physical characteristics of the goods.

12. Grund, a night club performer, financed the purchase of a drum set to be used in his night club act. The collateral is classified as a consumer good.

13. A secured transaction covers proceeds from the collateral unless such interest is expressly excluded.

14. When a security interest in property is inferior to other interests and claims to the property, it is said to be perfected.

15. A security interest need only be attached, not perfected, if there are no competing claims for the collateral.

16. Attachment provides creditors with rights.

17. Perfection can occur merely by possession of the collateral by the creditor.

18. Consumer goods are not subject to perfection of a security interest.

19. A financing statement need not be filed in a public place.

20. Under Revised UCC Article 9, a financing statement must be signed by the debtor.

21. Under Revised UCC Article 9, a debtor may authorize a financing statement by acquiring the collateral that is subject to the security agreement.

22. The steps in terminating a financing transaction upon full payment by the debtor include the preparation of a termination statement by the creditor and the presentation of the statement to the filing officer, who marks the record "terminated."