Security Interest Perfected Before Effective Date

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Section 9--703. Security Interest Perfected Before Effective Date.

(a) Continuing priority over lien creditor: perfection requirements satisfied. A security interest that is enforceable immediately before Revised Article 9 takes effect and would have priority over the rights of a person that becomes a lien creditor at that time is a perfected security interest under Revised Article 9 if, when Revised Article 9 takes effect, the applicable requirements for enforceability and perfection under Revised Article 9 are satisfied without further action.

(b) Continuing priority over lien creditor: perfection requirements not satisfied. Except as otherwise provided in Section 9--705 and subsection (c), if, immediately before this article takes effect, a security interest is enforceable and would have priority over the rights of a person that becomes a lien creditor at that time, but the applicable requirements for enforceability or perfection under this article are not satisfied when this article takes effect, the security interest:

(1) is a perfected security interest for one year after this article takes effect;

(2) remains enforceable thereafter only if the security interest becomes enforceable under Section 9--203 before the year expires; and

(3) remains perfected thereafter only if the applicable requirements for perfection under this article are satisfied before the year expires.

(c) Special rule for cooperative interests: perfection requirements not satisfied. If, immediately before Revised Article 9 takes effect, a security interest in a cooperative interest is enforceable and would have priority over the rights of a person that becomes a lien creditor at that time, but the applicable requirements for perfection under Revised Article 9 are not satisfied when Revised Article 9 takes effect, the security interest:

(1) is a perfected security interest for 5 years after Revised Article 9 takes effect; and

(2) remains perfected thereafter only if the applicable requirements for perfection under Revised Article 9 are satisfied before the 5 years expire.


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