If the collateral is in the possession of the creditor: ______.
A) a financing statement must be filed to perfect the interest.
B) the security interest is perfected.
C) only a security interest has been obtained.
D) the type of goods will determine the method of perfection.

Question

Quizplus · Accepted Answer

When the collateral is in the possession of the creditor, it is considered perfected automatically without the need for a financing statement or other methods of perfection. The creditor has physical control over the collateral, and the security interest is considered fully secured. Therefore, choice B is the correct answer.

If the Collateral Is in the Possession of the Creditor