Asked by refan waleed on Jul 06, 2024
Verified
To buy furniture, Gina, a consumer, signs a purchase agreement with Home Store, the seller, to pay $100 down and $50 per month until the price is paid. Home Store takes a security interest in the furniture. Because it was created as part of purchase agreement with a consumer, the security interest
A) is automatically perfected.
B) cannot be perfected.
C) can be perfected only by repossession.
D) can be perfected only by filing.
Automatically Perfected
Refers to a security interest that is deemed perfected without the need for any additional filing or action by the secured party.
Security Interest
A legal claim or right granted over assets as collateral to secure the payment of a debt or performance of some obligation.
Purchase Agreement
A legal document outlining the terms and conditions under which a sale of property will take place.
- Recognize the importance and process of filing a financing statement for perfecting a security interest.
Verified Answer
AM
Alyssa MartinezJul 11, 2024
Final Answer :
A
Explanation :
This security interest is automatically perfected because it was created as part of a purchase agreement with a consumer for consumer goods, which typically allows for automatic perfection without the need for additional steps such as filing.
Learning Objectives
- Recognize the importance and process of filing a financing statement for perfecting a security interest.