13 Pennsylvania Consolidated Statutes § 9205 - Use Or Disposition Of Collateral Permissible

§ 9205. Use or disposition of collateral permissible.

(a) When security interest not invalid or fraudulent.--A security interest is not invalid or fraudulent against creditors solely because any of the following apply:

(1) The debtor has the right or ability to:

(i) use, commingle or dispose of all or part of the collateral, including returned or repossessed goods;

(ii) collect, compromise, enforce or otherwise deal with collateral;

(iii) accept the return of collateral or make repossessions; or

(iv) use, commingle or dispose of proceeds.

(2) The secured party fails to require the debtor to account for proceeds or replace collateral.

(b) Requirements of possession not relaxed.--This section does not relax the requirements of possession if attachment, perfection or enforcement of a security interest depends upon possession of the collateral by the secured party.

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Last modified: October 8, 2016