Article 9 — Secured Transactions · Section 9-102
Understanding UCC § 9-102 is crucial for navigating secured transactions in commercial law.
Source: U.C.C. § 9-102
§ 9-102. (a) In this article: (1) 'Account' means a right to payment of a monetary obligation, whether or not earned by performance. (2) 'Chattel paper' means a record or records that evidence both a monetary obligation and a security interest in or a lease of specific goods. (3) 'Collateral' means the property subject to a security interest. (4) 'Debtor' means a person having an interest, other than a security interest or other lien, in the collateral. (5) 'Secured party' means a person in whose favor a security interest is created or provided for under a security agreement.
UCC § 9-102 provides definitions and explains key terms related to secured transactions. It serves as a foundational section that outlines the nature of collateral, debt relationships, and the parties involved in secured financing arrangements.
A legal claim to a debtor's property that secures payment or performance of an obligation.
The specific property or asset used to secure a loan.
The individual or entity that owes a debt and grants a security interest in specific collateral.
The entity or individual to whom a security interest is granted.
Example 1
A manufacturer borrows money from a bank using its inventory as collateral, establishing a secured interest under UCC § 9-102.
Example 2
A car dealer sells a vehicle with a financing agreement, where the lender retains a security interest in the vehicle until the loan is paid off.