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A security agreement under U.S. law is a contract that governs the relationship between the parties with some kind of financial transaction known as a secure transaction. In the case of a secure transaction, the Grantor (usually a borrower, but perhaps a surety or collateral) assigns the beneficiary (usually the lender) a security interest for personal property called security. Stocks, livestock and vehicles are examples of typical warranties. A guarantee contract is not used to transfer any shares in real estate (land/real estate), only personal property. The document used by lenders to obtain a right to pledge to real estate is a mortgage or an act of trust. In order for a security interest to be attached to the security held by subsequent buyers, it must be perfected. If the security contract for a security purchase is of interest to consumer products, perfection is automatic. Otherwise, the lender must register either the agreement itself or a UCC-1 funding declaration in an appropriate public place (usually the Secretary of State or a public enterprise commission under that person`s control). The enhancement of interest creates constructive communication, considered legally sufficient to inform the rest of the world of the lender`s rights over guarantees. When a borrower has used the same property as the guarantees for several guarantee agreements with different lenders, the first lender to register the interest is most entitled to that property. A security agreement may be oral if the guaranteed party (the lender) is in possession of the guarantees.

If the guarantee is physically held by the borrower or if the guarantee is an intangible value (. For example, a patent, [1) of claims or a debt title), the guarantee agreement must be made in writing to comply with the fraud law. The security contract must be authenticated by the debtor, i.e. it must bear the debtor`s signature or be marked electronically.