This text of Iowa § 554.9608 (Application of proceeds of collection or enforcement — liability for deficiency and right to surplus) is published on Counsel Stack Legal Research, covering Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
and right to surplus.
1. Application of proceeds, surplus, and deficiency if obligation secured. If a security
interest or agricultural lien secures payment or performance of an obligation, the following
rules apply:
a. a secured party shall apply or pay over for application the cash proceeds of collection
or enforcement under section 554.9607 in the following order to:
(1)the reasonable expenses of collection and enforcement and, to the extent provided
for by agreement and not prohibited by law, reasonable attorney’s fees and legal expenses
incurred by the secured party;
(2)thesatisfactionofobligationssecuredbythesecurityinterestoragriculturallienunder
which the collection or enforcement is made; and
(3)the satisfaction of obligations secured by any subordinate security interest in or
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and right to surplus.
1. Application of proceeds, surplus, and deficiency if obligation secured. If a security
interest or agricultural lien secures payment or performance of an obligation, the following
rules apply:
a. a secured party shall apply or pay over for application the cash proceeds of collection
or enforcement under section 554.9607 in the following order to:
(1) the reasonable expenses of collection and enforcement and, to the extent provided
for by agreement and not prohibited by law, reasonable attorney’s fees and legal expenses
incurred by the secured party;
(2) thesatisfactionofobligationssecuredbythesecurityinterestoragriculturallienunder
which the collection or enforcement is made; and
(3) the satisfaction of obligations secured by any subordinate security interest in or other
lien on the collateral subject to the security interest or agricultural lien under which the
collection or enforcement is made if the secured party receives a signed demand for proceeds
before distribution of the proceeds is completed.
b. if requested by a secured party, a holder of a subordinate security interest or other
lien shall furnish reasonable proof of the interest or lien within a reasonable time. Unless
the holder complies, the secured party need not comply with the holder’s demand under
paragraph “a”, subparagraph (3).
c. a secured party need not apply or pay over for application noncash proceeds of
collection and enforcement under section 554.9607 unless the failure to do so would be
commercially unreasonable. A secured party that applies or pays over for application
noncash proceeds shall do so in a commercially reasonable manner.
d. a secured party shall account to and pay a debtor for any surplus, and the obligor is
liable for any deficiency.
2. No surplus or deficiency in sales of certain rights to payment. If the underlying
transaction is a sale of accounts, chattel paper, payment intangibles, or promissory notes,
the debtor is not entitled to any surplus, and the obligor is not liable for any deficiency.