Article 9 — Secured Transactions · Section 9-201
Explore UCC § 9-201 which addresses the general enforceability of security interests under secured transactions.
Source: U.C.C. § 9-201
A financing statement must be filed in order to perfect a security interest in personal property. Generally, the rights of a secured party against a debtor are governed by this Article.
UCC § 9-201 establishes that security interests in personal property can be enforced as outlined in this Article. It clarifies the necessity for a financing statement to be filed to perfect such interests, ensuring legal backing for secured parties.
An interest in personal property or fixtures which secures payment or performance of an obligation.
A document filed to give notice of a security interest in personal property to third parties.
Example 1
A lender files a financing statement to secure its interest in a borrower’s inventory, thus ensuring its right to the inventory if the borrower defaults.
Example 2
A business owner gives a security interest in equipment to a bank and files a financing statement, establishing the bank’s lien in case of default.