Creditors’ Rights and Secured Transactions Self-Quiz

 

 

 

 

 

 

 

 

 

In order to “perfect” its security interest, a PMSI holder must:
Choice 1 file a financing statement with the appropriate states secretary of state.
Choice 2 do nothing, because it is a PMSI holder.
Choice 3 file a financing statement with the appropriate states land registry.
Choice 4 PMSI holders cannot perfect their security interest.
JoeCo provides brooms to Janitorial Retailer, Inc. ShineTime, Inc. provides Janitorial Retailer, Inc. with the soap it uses to clean its own floors but does not sell to customers. Both JoeCo and ShineTime are secured lenders to Janitorial Retailer, and both have “after acquired” clauses in their contracts. In a dispute, __________ will have a preferred interest in the assets of Janitorial Retailer because:
Choice 1 JoeCo / it provides inventory.
Choice 2 JoeCo / it provides operating supplies.
Choice 3 ShineTime / it provides inventory.
Choice 4 ShineTime / it provides operating supplies.
Tim is planning to make a loan to Shauna. Because of the size of the loan, Tim is requiring that Shauna offer up her prized collection of Pez Heads as collateral. In order to most quickly perfect his security interest, Tim would be advised to:
Choice 1 sell the Pez Heads and hold the cash as collateral.
Choice 2 mortgage the Pez Heads and hold the cash as collateral.
Choice 3 file a financing statement on the Pez Heads.
Choice 4 take the Pez Heads into his possession.
Ultimately, the primary goal of “secured transaction” law is to:
Choice 1 make sure creditors get their collateral as promised.
Choice 2 provide a notice mechanism to other potential lenders.
Choice 3 define the rights of parties in bankruptcy.
Choice 4 give borrowers notice of their rights as debtors.

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