On May 1, 2011, a new federal interim rule went into effect that will change the way garnishments on bank accounts are processed. The new rules will impact the processing of deposit account garnishments, state tax levies, federal tax levies and other legal processes in situations where the account holder receives federal benefit payments by direct deposit. Federal benefit payments include Social Security benefits, SSI benefits, VA benefits, and other federal employee benefits. (more…)
Banking and Financial Industry Blog
New Federal Garnishment Rules to Change Bank Account Garnishment Process
Tuesday, May 10th, 2011Indiana Passes Revisions to UCC Article 9 Laws
Monday, May 9th, 2011On April 20, 2011, Governor Mitch Daniels signed into law new amendments to Uniform Commercial Code Article 9 making Indiana the fourth state to adopt the proposed changes to revised Article 9. The main change affecting lenders is that beginning July 1, 2013, the “official” name for an individual debtor on a UCC Financing Statement will be the debtor’s name as shown on the Indiana drivers license or state I.D. This will also be the name that lenders will search under beginning July 1, 2013. Even though the new law does not take effect for over two years, it is not too soon for lenders to start changing their procedures to comply with the changes to the statute. (more…)
Lapsed Filings of Financing Statements
Tuesday, May 3rd, 2011Occasionally, a secured creditor may find itself in a situation where a UCC financing statement has expired, and the secured party has failed to file a continuation statement. Unfortunately, the Uniform Commercial Code does not allow for any exceptions for filing a continuation statement once the original financing statement has expired. (more…)
Kentucky Case Finds Liability for Wrongful Termination of Financing Statement
Tuesday, April 26th, 2011In a case recently decided in Kentucky, Secured Party A filed a termination statement relating to a financing statement originally filed by Secured Party B. The Court held that Secured Party A was not authorized to file the termination statement on behalf of Secured Party B. As a result of the wrongful termination, Secured Party A was liable to Secured Party B for damages incurred by the wrongful termination. (more…)
Court Helps Creditors With Example of “Commercially Reasonable Sale”
Tuesday, April 19th, 2011In recent cases in Indiana, the Court determined that the creditor’s sale of collateral was commercially reasonable, despite objections from the obligor. The sale was conducted as a public sale via the internet through an auction company. The notice of sale identified both the web address of the auction company where the public internet sale was to be conducted, and the physical address of the auction company. The obligor objected that the notice did not satisfy the requirement that the sale notice identify the location of the sale. The Court disagreed and found that the notice did properly identify the location of the sale, and that notice of the sale was properly given. (more…)
Kentucky Case Highlights Importance of Proper Method of Perfection
Tuesday, April 12th, 2011In a case recently decided in the Bankruptcy Court in Kentucky, the Court determined that a creditor’s security interest in a mobile home was unperfected because the security interest was not noted on the certificate of title for the mobile home. (more…)
Terms and Condition Statements – An Opportunity and a Caution
Tuesday, March 29th, 2011Every state has laws that control commercial transactions, most notably the Uniform Commercial Code. Under these laws, many different aspects of the sale and its impact on both sides of the deal are defined as to warranty, revocation, rights of collection and numerous other aspects. These laws almost universally provide that they apply only if the parties have not otherwise agreed in their sale contract. This gives the parties the ability to define for themselves what terms and conditions will apply to the transaction. (more…)
Down on the Farm – Taking a Security Interest in Motor Vehicles
Thursday, March 24th, 2011When making an agricultural loan, questions often arise about how to properly take a security interest in collateral typically associated with such a loan. Commonly, questions arise when taking a security interest in motor vehicles owned by a farmer.
Indiana’s motor vehicle code draws a distinction between “motor vehicles” on the one hand, and “farm tractors,” “farm trucks, farm trailers, or farm semitrailers and tractors,” “farm vehicles loaded with a farm product,” and “farm wagons” on the other. A “motor vehicle” is one which is self-propelled upon a highway, excluding farm tractors and farm implements designed to be primarily operated in a farm field or farm premises, among other things. A “motor vehicle” is subject to a certificate of title issued by the Indiana Bureau of Motor Vehicles.
In order to take a security interest in a motor vehicle, the secured party must include a specific description of the motor vehicle in the security agreement, and the secured party’s lien should be noted on the certificate of title and the certificate of title is then held by the secured party. Where a vehicle is required to be registered (as opposed to titled), the item should be specifically listed on the security agreement and a financing statement should be filed. Included among these vehicles are farm implements, farm tractors, and certain other types of farm machinery.
Author: Laura A. Scott (bio)
Phone: 812.452.3557
email: lscott@bamberger.com
Top Ten Tips for Debtor Names in Financing Statements
Tuesday, March 15th, 2011An often confusing and frustrating element for a lender when preparing a UCC financing statement is making sure that the debtor’s name is correct. Failure to have the correct name of the debtor on the financing statement can invalidate the effectiveness of your financing statement. Here are ten tips for making sure that you get the debtor’s name right: (more…)
Verbal Mortgage Release Not Enforceable
Thursday, March 10th, 2011An employer loaned his employee money to buy a house. As the employment relationship went on, the employee alleged that the employer agreed to release the mortgage on the house. However, no written document was ever signed releasing the mortgage. (more…)