IL Bar Practice Questions - Illinois Bar Examination Exam

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A seller sells goods on credit and takes a security interest in those very goods to secure the purchase price. The seller files within 20 days after the debtor receives the goods. What special priority does this interest enjoy?

No special priority Priority only if the debtor consents in writing Purchase-money security interest (PMSI) priority, which can take priority over earlier-perfected interests in the same collateral if perfection requirements are met Priority over all federal tax liens automatically

Correct Answer:

Purchase-money security interest (PMSI) priority, which can take priority over earlier-perfected interests in the same collateral if perfection requirements are met

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