[Anonymous]

Attachment requires:

a. Secured party gives value (value is any consideration that supports any contract)

b. Debtor has rights in collateral

c. Collateral must be in possession of secured party by debtor’s agreement (third party may possess if debtor agrees); or

Secured party must have “control” of collateral if it is investment property, deposit account, electronic chattel paper, or a letter-of-credit right; or A record of security agreement must exist

How is this different from perfection? Does perfection have of its own list of requirements?

[Jordan23cc]

Perfection occurs when the creditor applies for a financing statement. In order to perfect, attachment must occur first. Perfection gives the creditor rights to the collateral against third parties.

Thus, a perfected vs attached only credit –> perfected wins the rights to the collateral upon default.

F - 2/15/2014 - 85
B - 2/26/2014 - 88
R - 4/1/2014 - 83
A - 4/21/2014 - 95

Licensed CPA in TX

I can do all things through Christ who strengthens me.

[Jordan23cc]

Perfection occurs when the creditor applies for a financing statement. In order to perfect, attachment must occur first. Perfection gives the creditor rights to the collateral against third parties.

Thus, a perfected vs attached only credit –> perfected wins the rights to the collateral upon default.

F - 2/15/2014 - 85
B - 2/26/2014 - 88
R - 4/1/2014 - 83
A - 4/21/2014 - 95

Licensed CPA in TX

I can do all things through Christ who strengthens me.

[Anonymous]

Thanks man. And it does seem like I'm getting this topic, but each question on Secured Transactions requires so much thinking that I'm not sure I can run through the gauntlet if I come across any questions on this topic on exam day.

[Anonymous]

Thanks man. And it does seem like I'm getting this topic, but each question on Secured Transactions requires so much thinking that I'm not sure I can run through the gauntlet if I come across any questions on this topic on exam day.

[Anonymous]

Think about it this way: Atttachment concerns the relationship between the creditor and the borrower. Perfection concerns the relationship with the creditor and other creditors or would be creditors. Perfection helps protect the CREDITOR's interest in the collateral

Think about if you lent someone $ with their car as collateral. Attachment occurs when u secure a lien against that car. If that person goes to borrow more $ from someone else, u better hope your lien was perfected. Having your lien perfected 1. Tells other would-be creditors about your lien (constructive notice.) If the car is worth $10m and u have already lent $7m against it , your perfection of the lien will make a would be creditor aware of this and make him less likely to loan another $5m to the owner and secure a lien. 2. Puts u 1st in line legally to get your $ back from the prospective deadbeat.

[Anonymous]

Think about it this way: Atttachment concerns the relationship between the creditor and the borrower. Perfection concerns the relationship with the creditor and other creditors or would be creditors. Perfection helps protect the CREDITOR's interest in the collateral

Think about if you lent someone $ with their car as collateral. Attachment occurs when u secure a lien against that car. If that person goes to borrow more $ from someone else, u better hope your lien was perfected. Having your lien perfected 1. Tells other would-be creditors about your lien (constructive notice.) If the car is worth $10m and u have already lent $7m against it , your perfection of the lien will make a would be creditor aware of this and make him less likely to loan another $5m to the owner and secure a lien. 2. Puts u 1st in line legally to get your $ back from the prospective deadbeat.

[Jordan23cc]

You're welcome! Just remember those criteria you said in your original post are attachment criteria. A problem will say a financing statement was completed or the creditor had a perfected interest.

F - 2/15/2014 - 85
B - 2/26/2014 - 88
R - 4/1/2014 - 83
A - 4/21/2014 - 95

Licensed CPA in TX

I can do all things through Christ who strengthens me.

[Jordan23cc]

You're welcome! Just remember those criteria you said in your original post are attachment criteria. A problem will say a financing statement was completed or the creditor had a perfected interest.

F - 2/15/2014 - 85
B - 2/26/2014 - 88
R - 4/1/2014 - 83
A - 4/21/2014 - 95

Licensed CPA in TX

I can do all things through Christ who strengthens me.

[Author]

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