When a Debtor Fails to Pay a Debt and the Value

question 76

Multiple Choice

When a debtor fails to pay a debt and the value of the collateral is less than the full amount of the debt,which of the following is generally true?

• A) Unless the state prohibits or limits the deficiency judgment, the creditor can obtain a deficiency judgment against the debtor for the amount of the debt that was not satisfied from the collateral.
• B) The creditor must absorb the remaining loss, and has no further remedy.
• C) The creditor must file a bankruptcy proceeding against the debtor in order to obtain further relief.
• D) The creditor must record its security interest before proceeding further.
• E) A writ of garnishment entitles the creditor to collect the remaining amount of the debt.

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