BLAW Ch. 13 test

Voluntary Chapter 13 bankruptcies:

Apply to individuals only

Who has the same contract responsibilities as an assignee under a nonnegotiable instrument

Ordinary holder

Negotiable instruments include which of the following

Notes, drafts, and certificates of deposit

Which of the following is a note agreeing to repay borrowed money, probably with interest?

Promissory note

If a negotiable instrument is transferred by negotiation, the transferee takes the instrument:

free of transferers responsibilities

Under a Chapter 13 proceeding, debts must be repaid usually:

5 years

What is needed for there to be attachment of a security interest?

Customer has transferable rights, customer signed the debt instrument

To transfer an instrument made "to the order" of the payee, the payee must do what?

Deliver the instrument, endorse the instrument

As a creditor, a business should do which of the following?

Determine debtors ability to repay, limit it's long term debt

Filing for bankruptcy under Chapter 7 of the bankruptcy code results in what happening to debts?

Liquidation

If a negotiable instrument is transferred in what way does the transferee take the instrument free of any of the transferor's contract obligations?

Negotiation

A financial institution that receives a promissory note has the right to:

Sell note to another party

The one who agreed to make a payment, such as a bank making a payment based on a document presented to it is:

drawee

The one who issues or creates the document that requests payment, probably from a bank, is called:

drawer

If an instrument is found to be negotiable under the UCC, it may be freely traded without concern for any existing contract responsibilities if the instrument is in the possession of a holder in due course. To be a holder in due course, one must:

give value for the instrument, except it without knowledge of any defects, and take the instrument in good faith

The UCC governs the resolution of a dispute only when commercial paper is what type of instrument?

negotiable

Negotiable instruments

substitute for cash

When filing for personal bankruptcy. A person is more likely to file for Chapter 13 rather than Chapter 7 if the debtor's income is:

Higher than the states average