This has become a really hot topic around here of late and it is giving us fits. Can anyone give me some answers or opinions?
First, are the 2 terms interchangeable? Some people say yes and others have said no.
Say you have 2 loans that are written up as having completely different collateral - how do you document a cross pledge of collateral? Do you do a security agreement/pledge for each loan? Or do you do the security documents only in the loan that they are primarily pledged to and put a c/p clause in the docs? (for instance - loan A has stock and loan B has accounts & equipment)
What if you have 2 loans that have the exact same collateral - do you put a c/p clause in those docs, or does it go without saying that they are c/p because you have security docs for each loan?
Same for real estate...you do a FLDT and SLDT, so is it redundant to say they are cross pledged? Seems to me that it is, but I don't know.
I know this is a lot of questions. Any input would be appreciated!
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