Which of the following is false regarding a creditor's rights to collateral upon a debtor's default?
A) If a debtor defaults on a loan, the secured party can take possession of the collateral so long as the secured party does not breach the peace.
B) Under the UCC, the secured party can sell, lease, or transfer the collateral in any commercially reasonable method.
C) Regardless of where the collateral is sold, the secured party must strive to receive the best price for the collateral.
D) Instead of disposing of the collateral, the secured party may choose to keep the collateral in full or partial satisfaction of the debt.
E) A debtor in default has no rights in regard to whether collateral is retained by the secured party or sold.

Question

Quizplus · Accepted Answer

E is false because under the Uniform Commercial Code (UCC), a debtor does have rights even in default, including the right to be notified of the disposition of the collateral and, in some cases, the right to redeem the collateral before it is disposed of by the secured party.

Which of the Following Is False Regarding a Creditor's Rights