What are Consumer Goods for Art. 9?

Answered by:

Question:

Under the revised Article 9, we are required to terminate the UCC on consumer goods when the debt is satisfied. What is the definition of consumer goods?

Answer:

Revised Article 9 section 9-513(a) sets forth the requirement to file the termination statement for a financing statement that covers "consumer goods" if there is no obligation secured by the collateral covered by the financing statement and no commitment to make an advance, incur an obligation, or otherwise give value. The termination statement must be filed within one month after there is no obligation secured by the collateral or, if earlier, within 20 days after receiving written demand from the debtor.

According to Revised Art. 9 section 9-102(23), "consumer goods" means goods that are used or bought for use primarily for personal, family, or household purposes.

For the definition of "good" see Revised Art. 9 section 9-102(44) -- "goods" means all things that are movable when a security interest attaches. This includes manufactured homes. It does not include, among other things, deposit accounts.

Caveat: these rules come from the model Revised Article 9 provisions. Check your state version for possible variations.

Editor's Note: You'll find lots of Article 9-related resources in BOL's Article 9 Central section.

First published on BankersOnline.com 10/4/04