How do we collect for collateral that has been sold before payment was made?
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How do we collect for collateral that has been sold before payment was made?
We sold dogs to an individual on payments, because of past dealings that went great we also gave him the registration papers so he could continue with his breeding program without any holdups. He has only made a partial payment to us and has since sold the dogs. What are our legal rights?
Asked on January 18, 2012 under Bankruptcy Law, Oklahoma
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
If the person who owes you money sold the collateral for the loan before the loan was paid in full, the borrower has breached the security agreement with you warranting you to bring an action for the amount due. Unless the person who bought the dogs which were the collateral for the money owed, the buyer takes the dogs without any lien on the animals.
Your option is to have the person who owes you the money provide new and adequate security for the money owed and resume the installment payments or file an action for breach of the agreement to pay the money and for the security seeking what is owed.
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