New York § 9-205 Use or Disposition of Collateral Permissible

New York Statutes

§ 9-205 — Use or Disposition of Collateral Permissible

New York § 9-205

JurisdictionNew York

Law UCCUniform Commercial Code

Part 2Effectiveness of Security Agreement; Attachment of Security Interest; Rights of Parties to Security Agreement

Subpart 1Effectiveness and Attachment

Art. 9Secured Transactions

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

Bluebook

N.Y. Uniform Commercial Code § 9-205 (2026).

Text

Section 9--205. Use or Disposition of Collateral Permissible.\n  (a) When security interest not invalid or fraudulent. A security\ninterest is not invalid or fraudulent against creditors solely because:\n       (1) the debtor has the right or ability to:\n           (A) use, commingle, or dispose of all or part of the\n               collateral, including returned or repossessed goods;\n           (B) collect, compromise, enforce, or otherwise deal with\n               collateral;\n           (C) accept the return of collateral or make repossessions; or\n           (D) use, commingle, or dispose of proceeds; or\n       (2) the secured party fails to require the debtor to account for\n           proceeds or replace collateral.\n  (b) Requirements of possession not relaxed. This section does

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Section 9--205. Use or Disposition of Collateral Permissible.\n (a) When security interest not invalid or fraudulent. A security\ninterest is not invalid or fraudulent against creditors solely because:\n (1) the debtor has the right or ability to:\n (A) use, commingle, or dispose of all or part of the\n collateral, including returned or repossessed goods;\n (B) collect, compromise, enforce, or otherwise deal with\n collateral;\n (C) accept the return of collateral or make repossessions; or\n (D) use, commingle, or dispose of proceeds; or\n (2) the secured party fails to require the debtor to account for\n proceeds or replace collateral.\n (b) Requirements of possession not relaxed. This section does not\nrelax the requirements of possession if attachment, perfection, or\nenforcement of a security interest depends upon possession of the\ncollateral by the secured party.\n