Ask Reggi Your Question Now
Can you summarize IACO 554.9608?
UNIFORM COMMERCIAL CODE > Application of proceeds of collection or enforcement liability for deficiency and right to surplus.
Short Summary
This legal document, part of the Iowa Code’s Uniform Commercial Code, governs the application of proceeds, surplus, and deficiency when a security interest or agricultural lien secures payment or performance of an obligation. It outlines the order in which cash proceeds should be applied, including reasonable expenses of collection and enforcement, satisfaction of obligations secured by the security interest or agricultural lien, and satisfaction of obligations secured by any subordinate security interest or other lien. The document also addresses the requirement for holders of subordinate security interests or other liens to furnish proof of their interest or lien upon request by a secured party. It further states that noncash proceeds may not need to be applied unless it would be commercially unreasonable not to do so. Additionally, the document establishes that a secured party shall account to and pay a debtor for any surplus, while the obligor is liable for any deficiency. It also mentions that in sales of certain rights to payment, such as accounts, chattel paper, payment intangibles, or promissory notes, the debtor is not entitled to any surplus, and the obligor is not liable for any deficiency.
Whom does it apply to?
Secured parties, holders of subordinate security interests or other liens, debtors, and obligors
What does it govern?
Application of proceeds of collection or enforcement liability for deficiency and right to surplus
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No penalties are mentioned.
Jurisdiction
Iowa