Illinois § 9-205 Use or disposition of collateral permissible

Illinois Statutes

§ 9-205 — Use or disposition of collateral permissible

Illinois § 9-205

JurisdictionIllinois

TopicBUSINESS AND EMPLOYMENT

Ch. 810COMMERCIAL CODE

Act 810 ILCS 5/Uniform Commercial Code.

Art.Article 9 - Secured Transactions

This text of Illinois § 9-205 (Use or disposition of collateral permissible) is published on Counsel Stack Legal Research, covering Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

810 Ill. Comp. Stat. 9-205 (2026).

Text

(a)When security interest not invalid or fraudulent. A security interest is not invalid or fraudulent against creditors solely because:

(1)the debtor has the right or ability to:

(A)use, commingle, or dispose of all or part of the collateral, including returned or repossessed goods;

(B)collect, compromise, enforce, or otherwise deal with collateral;

(C)accept the return of collateral or make repossessions; or (D) use, commingle, or dispose of proceeds; or (2) the secured party fails to require the debtor to account for proceeds or replace collateral.

(b)Requirements of possession not relaxed. This Section does not relax the requirements of possession if attachment, perfection, or enforcement of a security interest depends upon possession of the collateral by the secured party.

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(a) When security interest not invalid or fraudulent. A security interest is not invalid or fraudulent against creditors solely because: (1) the debtor has the right or ability to: (A) use, commingle, or dispose of all or part of the collateral, including returned or repossessed goods; (B) collect, compromise, enforce, or otherwise deal with collateral; (C) accept the return of collateral or make repossessions; or (D) use, commingle, or dispose of proceeds; or (2) the secured party fails to require the debtor to account for proceeds or replace collateral. (b) Requirements of possession not relaxed. This Section does not relax the requirements of possession if attachment, perfection, or enforcement of a security interest depends upon possession of the collateral by the secured party.