Secutiry interest of home purchase4/8/2023 ![]() Farm products (livestock, crops, or other goods produced via farming operations).Inventory (raw materials held by a business for sale or lease).Additionally, the agreement should be authenticated, ideally before a notary or witness (or both).Ī variety of tangible and intangible goods can be used as collateral. These terms are outlined in detail below. To be deemed 'secured,' the agreement should be perfected. Once the security agreement is created, it should be attached. The property cannot be used in violation of any federal, state, or local laws, or in violation of an associated insurance policy.The debtor must keep the property in excellent condition.The property should not be wasted by the debtor.The debtor must notify the secured party if the property's value decreases or the property is somehow damaged.The debtor must notify the secured party immediately about changes in address.The property to be used as collateral is currently free of outside liens. ![]() ![]() Examples of covenants or warranties could include the following: Many include covenants (or obligations of the debtor) and warranties (guarantees). ![]() Most security agreements, however, go beyond these basic requirements. At a minimum, a valid security agreement consists of a description of the collateral, a statement of the intention of providing security interest, and signatures from all parties involved. ![]()
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