Yes. Just because the security interest isn’t registered does not mean the security agreement isn’t valid. Only if the security agreement had some defects such as the debtor did not sign it or it did not describe any collateral, then the secured creditor would not be able to enforce it.
If the collateral does not sell for enough to cover the remaining secured obligation owed to the secured creditor, the secured creditor has the right to obtain the remaining amount from the debtor directly or through other assets. The secured party may initiate a legal action against the debtor and get a judgment for the …
Disposal of the collateral is a legal term that basically means selling the collateral in an auction and applying the proceeds received from the sale to repay the loan. The proceeds received upon the sale of the collateral are given first to the secured creditor to satisfy their remaining obligation under the security agreement and …
What happens when the secured creditor disposes the debtor’s collateral? Read More »
Enforcing a security interest means that the secured creditor has legal remedies that include taking possession of the pledged collateral or disposing of the collateral through a sale and keeping some or all of the proceeds. The Act allows the secured creditor to proceed extra-judicially without having to obtain a court order before repossessing the …
In the event of default (the debtor does not repay a loan), the secured creditor has the right to enforce their security interest in the collateral. In this case, a Notice of Enforcement (Form VIII) must be electronically filed to the collateral registry at a fee of K50.
