Exam 23: Credit, Real Property Financing, and Secured Transactions

A power of sale proceeding should be initiated only with court proceedings.

Darrel,Smith,Keith and Aaron are claimants to a collateral interest.All four have secured their interests on the collateral.Aaron takes physical possession of the collateral.Keith files a financing statement some time later.Who among the four would have highest priority of claim to the collateral?

A deficiency judgment permits a secured lender to recover other property or income from a defaulting debtor if the collateral is insufficient to repay the unpaid loan.

Ethan purchases a house for $250,000.He borrows $200,000 from StarCross Bank and gives the bank a mortgage on the house for this amount.StarCross Bank fails to record the mortgage.Ethan then applies to borrow $200,000 from Pentalon Bank.Pentalon Bank reviews the real estate recordings and finds no mortgage recorded against the property,so it lends Ethan $200,000.Pentalon Bank records its mortgage.Later,Ethan defaults on both loans.In this case,which of the following would be true in case of the foreclosure,if possible,on the collateral?

________ is a document filed by a secured party that ends a secured interest because the debt has been paid.

Explain mortgage with an example.

A(n)________ is a situation in which a creditor has an enforceable security interest against a debtor and can satisfy the debt out of the designated collateral.

If two or more secured parties claim an interest in the same collateral but neither has a perfected claim,the first to attach has priority.

Which of the following federal laws allows debtors who are subject to a writ of garnishment to retain 75 percent of their weekly disposable earnings?

Differentiate two-party and three-party secured transaction.

William buys a house for $500,000 from Keith Geller through a realtor.He makes a down payment of $200,000.He borrows the rest from Smith and Sons,a lending firm,and places his new house as collateral for the loan.Who is the creditor in this case?

Which of the following is true of a deed of trust?

Kelly borrows $12,000 from Terry Oswald to pay for her mother's surgery.The debt-repayment period is 15 months but Kelly manages to repay it in 11 months.Which of the following must be filed by Oswald after receiving the final installment of his money?

Explain the process involved in perfection by filing a financing statement.

In surety arrangements,the creditor should have exhausted all other remedies against the principal debtor before seeking payment from the surety.

A ________ refers to a document filed by a secured creditor with the appropriate government office that constructively notifies the world of his or her security interest in personal property.

Which of the following is true of unsecured credit?

Financing statements are effective for one year from the date of filing.

Discuss the difference between secured and unsecured credit with an example.

In an unsecured credit,the creditor relies on the debtor's promise to repay the principal when it is due.