Perfection of Security Interest by Control

The video tutorial explains how electronic collateral is typically managed through accounts or electronic chattel paper. It highlights the importance of having an agreement or authority to exercise rights over such collateral. The tutorial further discusses how one can command a third party to control the collateral on their behalf, emphasizing the concept of security interest by control through legally enforceable agreements.

What is typically used to represent collateral electronically?

• Physical documents

• Cash transactions

• Electronic chattel paper

• Verbal agreements

What is necessary to exercise rights over collateral?

• A verbal promise

• A legally binding agreement

• A handshake

• A witness

Who can be commanded to control the collateral on your behalf?

• A family member

• A bank teller

• A third party

• A government official

What does a security interest by control rely on?

• Physical possession

• Verbal agreements

• Legally enforceable contracts

• Public announcements

What allows you to exercise control over collateral?

• A public declaration

• A notarized letter

• A legally enforceable contractual agreement

• A casual agreement