A Security Agreement Can Cover

question 73

Multiple Choice

A security agreement can cover:

• A) property not owned at the time of the agreement,but acquired later
• B) credit not owed at the time of the agreement,but acquired later
• C) neither A nor B
• D) both A and B

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Definitions:

Novation

The act of replacing an existing contract with a new one, wherein all parties agree to make the switch.

Factoring

A financial transaction where a business sells its accounts receivable to a third party at a discount to secure immediate capital.

Assignment

Assignment refers to the transfer of rights or property from one party to another, commonly seen in contracts and legal agreements.

Novation

The act of replacing one obligation with another by mutual agreement, effectively creating a new contract.