A secured party is an individual or entity that benefits from a security interest created under a security agreement. This can occur regardless of whether there is an outstanding obligation to be secured. The term also encompasses various roles, including those who hold agricultural liens, consignors, and representatives such as agents or trustees who have a security interest or agricultural lien in their favor.
The term "secured party" is primarily used in the context of secured transactions, which are governed by the Uniform Commercial Code (UCC). This legal framework is relevant in various areas, including commercial law and bankruptcy. Secured parties often engage in transactions involving loans or credit, where collateral is provided to secure the obligation. Users can manage some aspects of these transactions using legal templates available through US Legal Forms, which are drafted by experienced attorneys.
Here are a couple of examples of abatement:
Example 1: A bank provides a loan to a business and takes a security interest in the business's equipment. The bank is the secured party in this transaction.
Example 2: A farmer takes out a loan and offers their crops as collateral. The lender, who has a security interest in the crops, is considered a secured party. (hypothetical example)
The primary legal framework governing secured parties is the Uniform Commercial Code (UCC), particularly Article 9, which addresses secured transactions. This article outlines the creation, perfection, and enforcement of security interests.
| State | Key Differences |
|---|---|
| California | Specific requirements for agricultural liens differ. |
| New York | Different filing requirements for secured transactions. |
This is not a complete list. State laws vary and users should consult local rules for specific guidance.
| Term | Definition | Difference |
|---|---|---|
| Secured Party | Entity benefiting from a security interest. | Focuses on the party holding the interest. |
| Debtor | Individual or entity that owes money. | Refers to the party providing collateral. |
If you find yourself in a situation involving a secured party, consider the following steps:
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| Attribute | Details |
|---|---|
| Typical Fees | Varies by state and transaction type. |
| Jurisdiction | Varies by state; governed by UCC. |
| Possible Penalties | Loss of collateral, legal fees. |
A secured party is an individual or entity that has a security interest in collateral under a security agreement.