§ 5-3-201 — Security in sales or leases

(1) With respect to a consumer credit
sale, a creditor may take a security interest in the property sold. In addition, a
creditor may take a security interest in goods upon which services are performed or
to which goods sold are annexed, or in land to which the goods are affixed or that is
maintained, repaired, or improved as a result of the sale of the goods or services, if
in the case of a security interest in land the debt secured is three thousand dollars
or more, or in the case of a security interest in goods the debt secured is one
thousand dollars or more. Except as provided with respect to cross-collateral
described in section 5-3-202, a creditor may not otherwise take a security interest
in property of the consumer to secure the debt arising from a consumer credit sale.

(2) With respect to a consumer lease, a creditor may not take a security
interest in property of the consumer to secure the debt arising from the lease. This
subsection (2) does not apply to a security deposit for a consumer lease.

(3) A security interest taken in violation of this section is void.

Legislative History

Source: L. 2000: Entire article R&RE, p. 1218, � 1, effective July 1.