Registering Collateral

After the loan is repaid, how does the debtor make sure that the collateral is no longer included in a registration?

The law requires the secured creditor to cancel or discharge the registration after the loan has been repaid and all obligations have been satisfied under the security agreement. However, sometimes secured parties do not automatically do so. In the event that the secured creditor doesn’t cancel the registration, the debtor may send a formal request …

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How long does a registration remain effective in the Movable Property Registry System?

The period of registration is determined by the information contained in the financing statement which reflects the security agreement between the debtor and the secured creditor. It can be for a period of time or for a perpetual period. However if the collateral is described as consumer goods in the financing statement, this period of …

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What is priority?

The word priority refers to the right of a secured creditor to derive the economic benefit of a security interest in preference to the right of a competing claimant. Issues of priority arise in situations in which the debtor has granted security interests to multiple secured creditors in the same collateral or the debtor has …

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After the loan is repaid, how can a financing statement be discharged?

A secured creditor must discharge the registered financing statement within fourteen days after all obligations under the security agreement creating the security interest have been performed. A Notice of discharge must be electronically filled through Form IV and a fee of K100 must be paid. In the event that the secured creditor does not file …

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What happens if information about the debtor or the collateral changes after the original registration?

If information about the debtor changes, the security agreement will often require that the debtor informs the secured creditor of this change as soon as possible. Once informed, the secured creditor will electronically register an amendment to the financing statement through a prescribed form called Form IV. The Filing fee for a Notice of Amendment …

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What if the debtor did not give permission for the registration?

A registration cannot be made without the debtor’s prior permission. Any financing statement registered without the debtor’s permission or consent is invalid and does not create a security interest in any assets. Furthermore, the law gives the debtor the right to force the secured creditor to discharge such registration and to compensate the debtor for …

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