Gateway sold a big-screen TV and entertainment center to Iris for ...

[kwoodring]

Gateway sold a big-screen TV and entertainment center to Iris for 2000 on credit. Iris signed a promissory note and gave Gateway a security interest in the TV and entertainment center. Gateway filed a financing statement in the appropriate public office. When Iris defaulted on her monthly payments owing a balance of 1780, Gateway's attorney made arrangements to have the TV and entertainment center repossessed. The attorney then placed classified ads in the local newspaper to sell the goods. The attorney's fees are 300, the repo company charged 150, and the advertising costs are 50. (
 A) Is Iris able to redeem the property? (B) If Iris does not redeem and the TV and entertainment center are sold for 1750, how will the money be disbursed?

Question 2

Country Bank, located in Indiana, loaned Chmelik 5,000 and obtained a security interest in a copyright Chmelik owns. Chmelik lives in Illinois, but works in Indiana. In order to perfect its interest, Country Bank files a financing statement in Indiana. The financing statement provides Chmelik's correct name, his business address, and a reasonable description of the copyright used as collateral. Is the financing statement sufficient?
 A) Yes, it meets the UCC requirements for contents and filing.
 B) No, if the debtor is an individual, the secured party must file in the state of the debtor's principal residence, which in this case would be Illinois.
 C) No, the secured party needed to file a financing statement in both Indiana and Illinois.
 D) No, a security interest cannot be attached to a copyright.

[zenzy]

Answer to Question 1


(A) Yes, Iris may redeem the property. Up to the time that the secured party disposes of the collateral, the debtor has the right to redeem it. This means that the debtor can regain possession of the collateral if she pays the full balance of the note.
(B) If Iris does not redeem and the TV and entertainment center sell for 1750, the sale proceeds will be distributed as follows:


Sale Proceeds

1750.00

- Attorney's Fees

-300.00

- Repo Co.

-150.00

- Advertising

-50.00


Balance

1250.00

to be applied to the loan balance of 1780.



This leaves a deficiency balance of 530. Gateway can sue Iris to obtain a general unsecured judgment for this deficiency balance.



Answer to Question 2

B

[kwoodring]

Great answer, keep it coming

[sarah_brady415]

Excellent