What is Article 9?

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  • Written By: Chris Montgomery
  • Edited By: A. Joseph
  • Last Modified Date: 04 September 2019
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As part of the Uniform Commercial Code (UCC), Article 9 refers to the section of this code governing secured transactions of goods, either tangible or intangible, and the rights of the parties involved. The majority of the United States operates under the articles of this code, so it plays a significant role in the formation, execution and sale of security interests. It frequently is referred to in dealings between debtors, obligors and secured parties when rights of ownership are in question. It also regulates the sale of chattel goods, which are generally defined as tangible, movable property.

Article 9 encompasses secured debt of all types, including mortgages, deeds, liens and physical goods, such as timber, livestock and crops. Real estate contracts, commodities trades and agricultural liens are examples of transactions governed by Article 9 regulations. The details of this part of the UCC affect residential, commercial and farming mortgages, as well as commodity futures and options trades.

In January 2002, Article 9 was revised to give creditors increased rights to collateral and to make financial statement filings subject to stricter requirements. A debtor is considered the party with a property interest, and the obligor is the entity responsible for paying them. A secured party is one who benefits from the creation of a secured transaction. Alternatively, he or she acts as a neutral agent for holders of liens, deeds or other secured contracts.


In addressing the accurate and truthful filing of financial statements, debtors are expected to file within their jurisdiction and under a registered name. A business or individual name can be used, as long as it does not attempt to hide the debtor’s identity. A corporation with multiple locations generally will use the address of the main offices, and a local organization or individual will choose the state in which it is registered.

Besides financial statements, new revisions require foreclosing creditors to fill out forms used to satisfy secured creditors with respect to disposing of their collateral. This measure is intended to reduce conflict among parties seeking restitution from the foreclosing entity. A secured creditor must have a UCC-1 financial statement on file. This document details the creditor's rights to such collateral. The 2002 revisions can be applied to any transaction that ended before the new laws took effect but not to ongoing legal proceedings that were begun prior to the changes.


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