[Anonymous]

I came across this answer explanation (this is an explanation to an incorrect answer).

“This answer is incorrect because a subsequent bona fide purchaser will not defeat a prior perfected secured interest in consumer goods for which a financing statement has been filed. Such a purchaser will only defeat a prior perfected security interest that was perfected through automatic perfection by attachment.”

So wait a minute, this says there is actually a difference between a prior perfected secured interest through filing and through automatic perfection. If a security interest is perfected, why does it matter if it is perfected through a filing statement?

[Anonymous]

This stuff does get tricky…my take on it is;

With automatic perfection, there is no public notice given. Automatic perfection occurs mostly when a retailer buys to resell. Imagine yourself shelling out $400 at Best Buy for a new tv, then finding out a week later that BB had used that tv as collateral for a loan they never paid and someone takes it away from you. I think the law intends to protect consumers and allow them to buy stuff from a store without any fear that there will be attached liens that no one knew about. Therefore, the bona fide purchaser defeats this type of lien.

If a financing stmt had been filed, it could be argued that u should have known about this lien before you bought the tv, therefore it is not defeated. I think it helped me when i studied to try to imagine “real world” reasons for how/why these crazy laws came about and exist.

[Anonymous]

This stuff does get tricky…my take on it is;

With automatic perfection, there is no public notice given. Automatic perfection occurs mostly when a retailer buys to resell. Imagine yourself shelling out $400 at Best Buy for a new tv, then finding out a week later that BB had used that tv as collateral for a loan they never paid and someone takes it away from you. I think the law intends to protect consumers and allow them to buy stuff from a store without any fear that there will be attached liens that no one knew about. Therefore, the bona fide purchaser defeats this type of lien.

If a financing stmt had been filed, it could be argued that u should have known about this lien before you bought the tv, therefore it is not defeated. I think it helped me when i studied to try to imagine “real world” reasons for how/why these crazy laws came about and exist.

[Author]

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