§ 9508. Effectiveness of financing statement if new debtor becomes bound by security agreement.

264 words·~1 min read·/pa/title-13/chapter-95/9508

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(a)Financing statement naming original debtor.-- Except as otherwise provided in this section, a filed financing statement naming an original debtor is effective to perfect a security interest in collateral in which a new debtor has or acquires rights to the extent that the financing statement would have been effective had the original debtor acquired rights in the collateral.

(b)Financing statement becoming seriously misleading.-- If the difference between the name of the original debtor and that of the new debtor causes a filed financing statement which is effective under subsection

(a)to be seriously misleading under section 9506 (relating to effect of errors or omissions):

(1)the financing statement is effective to perfect a security interest in collateral acquired by the new debtor before and within four months after the new debtor becomes bound under section 9203(d) (relating to when person becomes bound by another person's security agreement); and

(2)the financing statement is not effective to perfect a security interest in collateral acquired by the new debtor more than four months after the new debtor becomes bound under section 9203(d) unless an initial financing statement providing the name of the new debtor is filed before the expiration of that time.

(c)When section not applicable.-- This section does not apply to collateral as to which a filed financing statement remains effective against the new debtor under section 9507(a) (relating to disposition).

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Cross References. Section 9508 is referred to in sections 9326, 9506, 9507 of this title.

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