Perfection does not always protect a secured party from third-party claims.

Name: Perfection does not always protect a secured party from third-party claims.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Perfection does not necessarily guarantee that a secured party will be able to avoid third-party claims on the collateral. There are situations where a third party may have priority over the secured party's claim, such as when the collateral is subject to a prior lien or security interest.

Perfection Does Not Always Protect a Secured Party from Third-Party