A person who takes a negotiable instrument for value, in good faith, and without notice that it is defective or overdue is referred to as a(n) ________.
A) holder
B) holder in due course
C) unqualified indorser
D) assignee

Question

Quizplus · Accepted Answer

A holder in due course is someone who takes a negotiable instrument (such as a check or promissory note) for value, in good faith, and without notice of any defects or overdue status. This status provides the holder with additional legal protections and rights, including being able to enforce the instrument against the maker or other parties, regardless of any potential claims or defenses against the original payee. The other choices do not necessarily require the same level of criteria to be met to apply.

A Person Who Takes a Negotiable Instrument for Value, in Good