Secured Transactions Under The Ucc

18 Questions | Total Attempts: 1289

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Secured Transactions Under The Ucc - Quiz

This quiz covers the basics of secured transactions under the Uniform Commercial Code, Article 9. It is intended as review for the Bar Exam.


Questions and Answers
  • 1. 
    The sale of collateral by the creditor to satisfy the debt must be commercially _____________.
  • 2. 
    Which UCC Aricle governs secured transactions?
    • A. 

      Article 1

    • B. 

      Article 5

    • C. 

      Article 3

    • D. 

      Article 9

  • 3. 
    What defines default in a secured transaction?
    • A. 

      Common law

    • B. 

      The UCC

    • C. 

      The agreement

  • 4. 
    After default, must a secured creditor notify the debtor of his intent to repossess the collateral?
    • A. 

      Yes

    • B. 

      No

  • 5. 
    A creditor may repossess collateral by any means, so long as he does not _______________________.
  • 6. 
    Can accounts be repossessed simply by directing the account holder to pay the creditor rather than the debtor?
    • A. 

      Yes

    • B. 

      No

  • 7. 
    After repossession, the debtor can _____________ the collateral by paying off the debt plus the creditor's repossession expenses and fees.
  • 8. 
    The debtor has the right to redeem property until (select all that apply):
    • A. 

      Foreclosure

    • B. 

      90 days have passed

    • C. 

      The property is sold

    • D. 

      The debtor waives the right of redemption

    • E. 

      The creditor makes a UCC-1 filing

  • 9. 
    When may a creditor himself bid on collateral put up for sale at a private sale (select all that apply)?
    • A. 

      When the sale is commercially reasonable

    • B. 

      When the sale is of an item customarily sold on a recognized market

    • C. 

      When there are no other bidders

    • D. 

      When the item is the subject of widely distributed standard price quotations

    • E. 

      Never

  • 10. 
    If the collateral property is not consumer goods, who must be notified of its impending sale (select all that apply)?
    • A. 

      The debtor

    • B. 

      The state

    • C. 

      Any secondary obligor

    • D. 

      Other parties the seller actually knows have an security interest in the collateral property

    • E. 

      Other parties who have filed UCC-1 filings on the collateral property

  • 11. 
    Which types of collateral may be sold without notice to the debtor, secondary obligors, or other creditors (select all that apply)?
    • A. 

      Those customarily sold on a recognized market

    • B. 

      Those subject of widely distributed standard price quotations

    • C. 

      Those subject to a fixture filing

    • D. 

      Those that are perishable

    • E. 

      Those that will depreciate quickly

  • 12. 
    If the collateral property is consumer goods, who must be notified of its impending sale (select all that apply)?
    • A. 

      The debtor

    • B. 

      The state

    • C. 

      Any secondary obligor

    • D. 

      Other parties the seller actually knows have an security interest in the collateral property

    • E. 

      Other parties who have filed UCC-1 filings on the collateral property

  • 13. 
    Can the debtor waive notice of impending sale of his repossessed collateral?
    • A. 

      Yes, at any time.

    • B. 

      Yes, but only before default.

    • C. 

      Yes, but only after default.

    • D. 

      Yes, but only by attempting to redeem.

    • E. 

      No.

  • 14. 
    After collateral is sold, the proceeds are first paid for what?
    • A. 

      The secured debt to the disposing creditor

    • B. 

      The creditor's cost of sale

    • C. 

      Other secured creditors with an interest in the same collateral who make a demand

    • D. 

      Other secured creditors to whom the debtor is in default

    • E. 

      The debtor

  • 15. 
    After collateral is sold and the disposing creditor has been paid for any costs associated with the sale, any remaining proceeds are next paid for what?
    • A. 

      The secured debt to the disposing creditor

    • B. 

      Other secured creditors with an interest in the same collateral who make a demand

    • C. 

      Other secured creditors to whom the debtor is in default

    • D. 

      The debtor

  • 16. 
    After collateral is sold and the proceeds are used to pay for the cost of the sale and the secured debt to the disposing creditor, the excess (if any) is paid next for what?
    • A. 

      Other secured creditors with an interest in the same collateral who make a demand

    • B. 

      Other secured creditors to whom the debtor is in default

    • C. 

      The debtor

  • 17. 
    After collateral is sold, and the disposing creditor has been paid for the costs of the sale and the secured debt, and any other secured creditor with an interest in the same collateral who made a demand has also been paid, the excess (if any) is paid to whom?
    • A. 

      Other secured creditors to whom the debtor is in default

    • B. 

      The debtor

  • 18. 
    When a creditor negotiates to buy collateral from the debtor in exchange for forgiveness of some or all of the debt, it is known as:
    • A. 

      Negotiation

    • B. 

      Forced default

    • C. 

      Strict foreclosure

    • D. 

      Deficiency

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