Exam 9: Secured Transactions and Bankruptcy

An involuntary bankruptcy petition can be filed if:

The debtor must file a repayment plan within _____ days after the petition is filed for a Chapter 13 bankruptcy.

If the surety is forced to pay off the creditor, the surety steps into the shoes of the creditor. This is called _____ and confers upon the surety all the rights the creditor has against the debtor.

Discuss the significance of the '341' meeting.

Patents and trademarks fall under the chattel paper category of collaterals.

Which of the following is a category of goods used as collateral?

A fraudulent scheme in bankruptcy involves a protracted plan to con a creditor into thinking it is dealing with an upstanding debtor. The debtor makes payments on time and lulls the creditor into shipping more and more goods. The debtor then begins missing payments and tells the creditor it is having cash flow problems. The truth is the debtor has sold the creditor's merchandise and made off with the money. This fraudulent bankruptcy scheme is known as ___.

A debtor that files under Chapter 11 can remain "in possession of the assets" while undergoing reorganization under Chapter 11, without the appointment of a trustee.

A(n) _____ is the right given to a skilled person to retain possession of an item, produced with his or her labor and materials, until paid.

This fraudulent scheme in bankruptcy occurs when a failing company moves its assets to a new business which is thriving after convincing the creditors that they should accept what the new buyer is offering for its debts. After the creditors accept pennies on the dollar for the sold company, they learn that the "new" company was a straw company set up by the principal of the failed business. Identify the fraudulent bankruptcy scheme in discussion.

Debtor's property in which the debtor gives an interest to the creditor as security for its debt is known as ___.

If a debtor goes bankrupt and has more than one secured creditors then:

James has taken a loan of $10,000 from a bank with Julia and Robert as his sureties. However when the money becomes due, James is unable to pay the amount. Robert, as one of James' sureties, pays the entire amount to the bank. Robert, now, has the right to receive a proportionate share of this obligation from Julia. This right is known as the right of ___.

Which of the following categories of collateral is used as a catchall phase for interests not otherwise covered unless they are specifically excluded?

In the context of defining collateral, goods is used as a catchall phase for interests not otherwise covered unless they are specifically excluded.

One nationwide rule governs the filing of financing statements for perfecting security interests.

_____ is a writing or writings which evidence both a monetary obligation and a security interest in, or a lease of, specific goods when a creditor sells the security agreement of his debtor along with his interest in the collateral to a third party.

Discuss the various defenses available to a surety.

If the surety is an absolute surety, then before the creditor can collect from the surety, the creditor must exhaust all other legal remedies to collect from the debtor.

What is a secured transaction?