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Preserving Purchase Money Security Interests And Allocating Payments, Lynda Kay Chandler
Preserving Purchase Money Security Interests And Allocating Payments, Lynda Kay Chandler
University of Michigan Journal of Law Reform
This Note explores the rationale underlying the courts' conflicting decisions in light of the purposes of the UCC. It concludes that the language of the UCC and its goals of uniformity and simplification require that a PMSI should not be entirely destroyed because a creditor also has a security interest in items the debtor acquired after the purchase money transaction or because a creditor extends additional credit. The best solution is to permit the creditor to retain a PMSI, to the extent of the purchase money loan, in those goods that the creditor's loan helped to purchase.
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