Collateral securing loans and credit arrangements with personal or business property.
SECURITY AGREEMENT
This Security Agreement is made on [DATE] between [DEBTOR NAME] ("Debtor") and [SECURED PARTY NAME] ("Secured Party").
1. SECURED OBLIGATIONS
This Agreement secures payment of all obligations under [LOAN/CREDIT AGREEMENT] dated [DATE] in the amount of $[AMOUNT].
2. COLLATERAL DESCRIPTION
Debtor grants Secured Party a security interest in the following collateral: [DETAILED COLLATERAL DESCRIPTION].
3. DEBTOR WARRANTIES
Debtor warrants: (a) ownership of collateral free of liens, (b) authority to grant security interest, (c) collateral will be maintained in good condition.
4. DEFAULT
Default occurs upon: (a) failure to make payments when due, (b) breach of warranties, (c) bankruptcy or insolvency proceedings.
5. REMEDIES UPON DEFAULT
Upon default, Secured Party may: (a) take possession of collateral, (b) sell collateral at public or private sale, (c) exercise all rights under applicable law.
6. INSURANCE AND MAINTENANCE
Debtor shall maintain insurance on collateral and keep it in good repair at Debtor's expense.
DEBTOR: _________________ SECURED PARTY: _________________
[DEBTOR NAME] [SECURED PARTY NAME]
Date: ___________ Date: ___________
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A Security Agreement creates a legal security interest in personal or business property used as collateral to secure loans, credit lines, or other financial obligations, protecting lenders' interests in case of default. Essential for secured loans, equipment financing, inventory financing, and business credit arrangements, this agreement establishes lender rights to collateral while allowing borrowers to continue using assets during the loan term. The document typically covers collateral descriptions, debtor warranties, default provisions, enforcement remedies, insurance requirements, and maintenance obligations. Critical for lenders who need asset-backed security for loans, and for borrowers who can obtain better financing terms by pledging collateral, ensuring clear legal framework for secured transactions and protecting both parties' interests in valuable assets.