UCC Article 9 Overview
UCC Article 9 governs secured transactions -- loans backed by personal property. While the base UCC does not mandate pre-repossession cure, it requires notice of sale, commercially reasonable disposition, and accounting for surplus. State adoptions often add cure rights.
Notice Requirements
UCC 9-611 requires the secured party to send notice before disposing of collateral. Many state adoptions add a cure period requirement. The notice must be sent in a reasonable time -- 10 days is a common minimum.
Commercially Reasonable Disposition
UCC 9-610 requires every aspect of the sale to be commercially reasonable. If the creditor conducts an unreasonable sale, you can challenge the deficiency balance. In some states, an unreasonable sale eliminates the deficiency entirely.
Frequently Asked Questions
Does the UCC apply to my car loan?
Yes. Auto loans are secured transactions governed by UCC Article 9 as adopted by your state.
What is the difference between cure and redemption?
Cure means paying only past-due amounts to reinstate the loan. Redemption means paying the entire remaining balance. Cure is cheaper. Redemption is available under UCC 9-623 until the collateral is sold.
Can a business debtor cure under the UCC?
Yes, but consumer-specific protections may not apply. Business debtors rely on base UCC provisions. Business bankruptcy options are also available.
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