What is the security?
Identify the instrument creating it, the asset, the secured obligation, and required registration. A personal guarantee is not the same as a lien on property.
Validity and scope
Determine whether the security was validly created and registered, which obligations it covers, and its priority against competing rights. Broad contractual language does not eliminate review of law and registration.
Asset value and deficiency
If collateral value is lower than the debt, an unsecured deficiency may remain. If higher, realization expenses and other rights in the asset must be considered.
Action within insolvency
A secured creditor does not disregard the insolvency proceeding. Reporting, proofs of debt, notices, and realization motions should be considered under the statutory framework and case orders.
Concluding point
Secured status is determined by the legal right in the asset, not merely the strength of the demand or existence of debt.
Principal legal sources
- Insolvency and Economic Rehabilitation Law, 5778-2018.
- Pledges Law, 5727-1967.
- Land Law, 5729-1969.