What is a secured transaction?

A secured transaction is a transaction between a debtor (the individual or business who owes money) and a creditor (the individual or business who is owed money). Under a secured transaction, the creditor holds some kind of property as collateral against the loan. This collateral is usually something of equal value to the loan amount, such as an item of personal property, such as a car or other valuable asset. In Illinois, the Uniform Commercial Code (UCC) governs secured transactions. This means that a secured transaction must be in writing and must include certain provisions. These provisions include the terms of the transaction, such as when and how much the debtor will pay, as well as what type of collateral is being held as security. When a debtor fails to make payments according to the terms of the secured transaction, the creditor can take possession of the collateral and sell it to satisfy the debt. This process is called foreclosure. Overall, a secured transaction is an agreement between a debtor and creditor that gives the creditor certain rights over the debtor’s property in exchange for the borrower receiving a loan. This can be an effective way for a creditor to ensure that they receive payment in a timely manner and can help the debtor secure financing for a valuable asset.

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What is a secured transaction?

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