MODULE 26 SECURED TRANSACTIONS 227

a. May be a public or a private sale

b. Must use commercially reasonable practices-this right cannot be waived by debtor
c. Must sell within a reasonable time
d. Must notify debtor of time and place of public sale or time after which private sale will occur
unless collateral is perishable, threatens to decline in value, or is type sold on a recognized market
(1) Must also notify other secured parties (who have sent written notice of their interest) unless
collateral consists of consumer goods

e. Secured party may buy at any public sale and also at a private sale if rights of debtor protected
f. Subordinate claims are entitled to any surplus
(1) Debtor is entitled to surplus (if any) after all claims and expenses are paid or is liable for defi-
ciency (if any)

5. Debtor has right to redeem collateral before secured party disposes of it by paying
a. Entire debt, and
b. Secured party's reasonable expenses
6. Most remedies can be varied by agreement if reasonable
a. Provision that secured party must account for any surplus to debtor cannot be varied by agreement
7. Good-faith purchaser (i.e., for value and with no knowledge of defects in sale) of collateral takes free
of debtor's rights and any secured interest or lien subordinate to it

a. Receives debtor's title

b. If sale was improper, remedy of debtor is money damages against secured party who sold collat-

eral, not against good-faith purchaser.

G. Other Rights of Parties
1. Debtor has right to request that creditor show proof of unpaid debt or request that creditor correct
incorrect filings on collateral

a. Creditor must either show that debt or filing is correct or make correction
2. When debtor pays debt in full, s/he has right to termination statement of creditor which creditor files
or in some cases provides to debtor .
a. This provides notice that earlier filing has been satisfied
3.After expenses are paid for repossessing collateral, storage, and reselling collateral, excess proceeds
go to secured party, then to other lien holders