Exam 28: Introduction to Credit and Secured Transactions

Under the ________ system,the subcontractors or materialmen have direct liens and are entitled to liens for the value of labor and materials furnished,irrespective of the amount due from the owner to the contractor.

An unsecured credit transaction involves the lowest risk to the creditor.

A distinction between a surety and a cosurety is that only a cosurety is entitled to the right of/to:

Tracy contracted with Stanley to pay 2 installments of $1000 over a two-month period to buy a new laptop from Stanley.Juan co-signed the note for Tracy.Tracy could not make the second payment on time and Stanley extended the repayment period to three months.Is Juan still responsible as a surety?

________ is the method by which the rights of the property owner are cut off so that the lienholder can realize her security interest.

In the case of foreclosure by action and sale,the creditor has no right to a deficiency and the debtor has no right to any surplus.

Most state laws say that a valid mechanic's lien has priority over all other liens that attach after the first work is performed or the first materials are furnished.

A difference between a surety and a guarantor is that the guarantors:

Sarah,age 17,buys a car on credit from Lora.Sarah signs a promissory note,agreeing to pay $1000 a month on the note until the note is paid in full.Lora has Sarah's father cosign the note.Under these circumstances,Sarah's father is:

A software engineer installs new software in Dick's computer and returns the computer to Dick.Dick defaults in his payments for the new software.The software engineer loses his right of lien because: