A security agreement is a contract that grants a
creditor a security interest in
pledged by a debtor or borrower.
If the debtor has rights in the collateral, a security
interest attaches to the collateral as provided in
Article 9 of the UCC.
In some instances the holder of the security
interest takes possession of the collateral. In many
instances, the debtor is allowed to retain the
If the debtor defaults, the security holder can
convert the collateral into cash by conducting a
sale in accordance with the provisions of Article 9.