Basic Uniform Commercial Code

Security Agreement


A security agreement is a writing (or electronic record) that provides a description of the collateral, the debtor's intent to grant a security interest, and the debtor's signature.

The description must be sufficient to describe the particular item, as defined in UCC § 9-108.

In a majority of states, inventory, accounts receivable, chattel papers, etc. are assumed to include future inventory, etc. However, this should not be relied upon.

A financing statement can also be a security agreement.

Financing Statement

A financing statement is a record that is publicly filed to put other people on notice of a security interest in the collateral.

A financing statement does not have to be very specific.

UCC § 9-108(c) says the very generic from the financing statement will not work.

A security can be oral. An authenticated security agreement cannot.