§ 9-607 — Collection and Enforcement by Secured Party

New York § 9-607

• Jurisdiction: New York
• Law UCC: Uniform Commercial Code
• Part 6: Default
• Subpart 1: Default and Enforcement of Security Interest
• Art. 9: Secured Transactions

Text

Section 9--607. Collection and Enforcement by Secured Party.\n (a) Collection and enforcement generally. If so agreed, and in any\nevent after default, a secured party:\n (1) may notify an account debtor or other person obligated on\n collateral to make payment or otherwise render performance to\n or for the benefit of the secured party;\n (2) may take any proceeds to which the secured party is entitled\n under Section 9--315;\n (3) may enforce the obligations of an account debtor or other\n person obligated on collateral and exercise the rights of the\n debtor with respect to the obligation of the account debtor\n or other person obligated on collateral to make payment or\n otherwise render performance to the debtor, and with respect\n to any property that secures the obligations of the account\n debtor or other person obligated on the collateral;\n (4) if it holds a security interest in a deposit account\n perfected by control under Section 9--104 (a) (1), may apply\n the balance of the deposit account to the obligation secured\n by the deposit account; and\n (5) if it holds a security interest in a deposit account\n perfected by control under Section 9--104 (a) (2) or (3), may\n instruct the bank to pay the balance of the deposit account\n to or for the benefit of the secured party.\n (b) Nonjudicial enforcement of mortgage. If necessary to enable a\nsecured party to exercise under subsection (a) (3) the right of a debtor\nto enforce a mortgage nonjudicially, the secured party may record in the\noffice in which a record of the mortgage is recorded:\n (1) a copy of the security agreement that creates or provides for\n a security interest in the obligation secured by the\n mortgage; and\n (2) the secured party's sworn affidavit in recordable form\n stating that:\n (A) a default has occurred with respect to the obligation\n secured by the mortgage; and\n (B) the secured party is entitled to enforce the mortgage\n nonjudicially.\n (c) Commercially reasonable collection and enforcement. A secured\nparty shall proceed in a commercially reasonable manner if the secured\nparty:\n (1) undertakes to collect from or enforce an obligation of an\n account debtor or other person obligated on collateral; and\n (2) is entitled to charge back uncollected collateral or\n otherwise to full or limited recourse against the debtor or a\n secondary obligor.\n (d) Expenses of collection and enforcement. A secured party may deduct\nfrom the collections made pursuant to subsection (c) reasonable expenses\nof collection and enforcement, including reasonable attorney's fees and\nlegal expenses incurred by the secured party.\n (e) Duties to secured party not affected. This section does not\ndetermine whether an account debtor, bank, or other person obligated on\ncollateral owes a duty to a secured party.\n