Second, a significant security interest has potential value, given that the remedies available to a party insured under article 9 are available to both mature and uninfected secured creditors. These are, first, mutual assistance measures that allow a secured creditor to claim security rights or their proceeds without judicial participation, provided that such acts can be performed without “breach of the peace” (see section 9-609 of the Investigation PERIOD). In particular, an unperfected creditor [seller] may take security [the goods made available, perhaps] or the proceeds of the security rights of the defaulting secured [buyer] debtor. It can be as easy as showing up in the buyer`s property and asking them to return the warranties. Indeed, I often recommend a non-confrontational approach by the employee of a known seller so that the appearance of the seller/lawyer of the secured party does not encourage the defaulting buyer/debtor to go to his lawyer instead of responding to the demand for security turnover. Equitable links are slightly amorphous forms of safeguard rights that are established only by law in certain circumstances. It has been found academically that there does not seem to be any real unifying principle behind the circumstances that lead them.  In order for the insured party to benefit from a security guarantee right, three things must be in place: 1) the insured party must pay to preserve the interest of the guarantee or give something valuable; (2) the debtor must own the security or have appropriate security authority to mortgage the security right and (3) the debtor must sign a contract of guarantee. As soon as the three points occur, the insured party rightfully has a guarantee right over the guarantees.
This process is called “seizure” of a security interest. In the event that the first two subject-matter is present, the secured party must be accompanied by a related security interest when the debtor signs the security agreement. Second, the insured party must “perfect” its security interest. This means that the insured party has taken steps to ensure that no other creditor is entitled to the advance security and that the insured party can claim the guarantees in the event of the debtor`s insolvency or declaration of bankruptcy. While the law does not require the development of a guarantee right, it is often the only way for the insured party to be sure that its security interest is safe from other creditors. You can further your interest by simply filing a brief document, which is called a financing statement, in the debtor`s state or local jurisdiction. Where the debtor is a natural person, this is the State in which the debtor resides; If the debtor is an enterprise, it is the State in which the enterprise was established. While the rules vary by location, a financing statement normally requires only the identification of the parties and the provision of a description of the security rights. In most countries, you can easily provide this information by filling out form UCC-1 and submitting it to the office of the Minister of Foreign Affairs. You can find your country`s requirements online or by phone at your National Office.
If the details of the refund are already included in a separate agreement – for example. B in a debt or loan agreement – it is enough to indicate the name of the contract and its expiry date. If this is not the case, you can include refund terms in your security agreement, including whether the refund is made monthly, at the request of the guaranteed party or in the form of a one-time lump sum payment.