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Expert: Regan Shinski - 2/10/2010


Question
QUESTION: Hello Teacher,

Q: What happened to (purchase money security interest) PMSI when we buy an automobile on credit? Do we perfected the security interest here? As I read that in PMSI the security is perfected automatically when we buy consumer goods.
Thanks!

ANSWER: PMSI requires several criteria to be met to be be enforced.  For example, a simple one is that the debtor must have knowledge that the PMSI arrangement even exists - authentication.  So the use of the specific PMSI terms may or may not be used in an auto contract but some type of notification or contractual obligation giving the lender security rights is almost always written in.

PMSI is more broadly used in business credit, inventory purchases, or larger, non-traditional purchases but is creeping into consumer debt more often.

Thank you for your question, I hope this helps :)

Regan

---------- FOLLOW-UP ----------

QUESTION: Thank you teacher,
There is one more question here.
What are basic requirement to secure security interest?
Should the debtor be responsible in providing information to lender in order to secure money?
And teacher, this writing agreement is necessary to exist?
Thanks for replying.
Take care!

Answer
It has to be clearly written in the agreement what the security interest is, what is needed to clear the security interest (usually contractual repayments), and what are the ramifications are if the value (payments) are not made.

A written agreement technically is not needed but it becomes virtually impossible to prove the PMSI requirements through an oral contract.

Good luck,
Regan

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Regan Shinski

Expertise

I can answer questions on collections, repossessions, bankruptcy, credit repair, credit counseling, FICO scores, credit planning, and the cause and effect of credit related decisions. I can also answer questions on collection settlements and preparing to sue your creditors for false debts and credit credit reporting.

Experience

Fifteen years ago I was financially devasted due to severe health issues. I filed bankruptcy, had a foreclosure, car repossession, tax lien, and ruined credit. I immersed myself in credit law. I settled dozens of accounts and had them removed to improve my credit. I personally sued four creditors and collection agencies and won cash settlements for their false reporting on my credit reports. Since then, I have completely recovered and have nearly $100,000 in revolving credit lines and perfect credit. I have owned a credit repair company for the past five years and have an additional three years of specific work in the collections and debt management industry. I am fully versed in the Fair Debt Collection Practices Acts (FDCPA), Fair Credit Reporting Act (FCRA), and have used them successfully in collection settlements and lawsuits for myself and others. I am also familiar with and abide by the Credit Repair Organizations Act (CROA). I have deleted or helped delete literally hundreds and hundreds of derogatory items from consumers' credit reports and helped negotiate many settlements with collection agencies and creditors. I have also advised people on bankruptcy at any stage. In the current credit market, I have successfully advised numerous people on how to obtain credit and how to negotiate for better terms.

Education/Credentials
BA University of Minnesota

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