What is the difference between a chattel mortgage and a conditional sale contract?
A) a conditional sale is a personal obligation of the buyer, whereas a chattel mortgage does not bind the chattel mortgagor personally
B) in a conditional sale contract the security is the property sold, whereas a chattel mortgage can have as security any chattels
C) a chattel mortgage must be registered to affect third parties, whereas a conditional sale agreement does not need to be registered to affect third parties
D) if there is default under a conditional sale contract, the seller can seize the goods and sue the buyer for any deficiency, whereas under a chattel mortgage the chattel mortgagee can only seize the goods
E) none of the above is correct

Question

Quizplus · Accepted Answer

The main difference between a chattel mortgage and a conditional sale contract is the security used. In a chattel mortgage, any chattels can be used as security, while in a conditional sale contract, the property sold is the security. The other options are not accurate differences between the two. For example, both a conditional sale and a chattel mortgage can create personal obligations for the buyer; both can affect third parties and both allow the seller or chattel mortgagee to seize the goods in the event of default.

What Is the Difference Between a Chattel Mortgage and a Conditional