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Illinois Compiled Statutes

Information maintained by the Legislative Reference Bureau
Updating the database of the Illinois Compiled Statutes (ILCS) is an ongoing process. Recent laws may not yet be included in the ILCS database, but they are found on this site as Public Acts soon after they become law. For information concerning the relationship between statutes and Public Acts, refer to the Guide.

Because the statute database is maintained primarily for legislative drafting purposes, statutory changes are sometimes included in the statute database before they take effect. If the source note at the end of a Section of the statutes includes a Public Act that has not yet taken effect, the version of the law that is currently in effect may have already been removed from the database and you should refer to that Public Act to see the changes made to the current law.


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810 ILCS 5/Art. 9 Pt. 6 Sub. 1

 
    (810 ILCS 5/Art. 9 Pt. 6 Sub. 1 heading)
SUBPART 1. DEFAULT AND ENFORCEMENT
OF SECURITY INTEREST

810 ILCS 5/9-601

    (810 ILCS 5/9-601)
    Sec. 9-601. Rights after default; judicial enforcement; consignor or buyer of accounts, chattel paper, payment intangibles, or promissory notes.
    (a) Rights of secured party after default. After default, a secured party has the rights provided in this Part and, except as otherwise provided in Section 9-602, those provided by agreement of the parties. A secured party:
        (1) may reduce a claim to judgment, foreclose, or
    
otherwise enforce the claim, security interest, or agricultural lien by any available judicial procedure; and
        (2) if the collateral is documents, may proceed
    
either as to the documents or as to the goods they cover.
    (b) Rights and duties of secured party in possession or control. A secured party in possession of collateral or control of collateral under Section 7-106, 9-104, 9-105, 9-106, or 9-107 has the rights and duties provided in Section 9-207.
    (c) Rights cumulative; simultaneous exercise. The rights under subsections (a) and (b) are cumulative and may be exercised simultaneously.
    (d) Rights of debtor and obligor. Except as otherwise provided in subsection (g) and Section 9-605, after default, a debtor and an obligor have the rights provided in this Part and by agreement of the parties.
    (e) Lien of levy after judgment. If a secured party has reduced its claim to judgment, the lien of any levy that may be made upon the collateral by virtue of a judgment relates back to the earliest of:
        (1) the date of perfection of the security interest
    
or agricultural lien in the collateral;
        (2) the date of filing a financing statement covering
    
the collateral; or
        (3) any date specified in a statute under which the
    
agricultural lien was created.
    (f) Execution sale. A sale pursuant to a judgment is a foreclosure of the security interest or agricultural lien by judicial procedure within the meaning of this Section. A secured party may purchase at the sale and thereafter hold the collateral free of any other requirements of this Article.
    (g) Consignor or buyer of certain rights to payment. Except as otherwise provided in Section 9-607(c), this Part imposes no duties upon a secured party that is a consignor or is a buyer of accounts, chattel paper, payment intangibles, or promissory notes.
(Source: P.A. 95-895, eff. 1-1-09.)

810 ILCS 5/9-602

    (810 ILCS 5/9-602)
    Sec. 9-602. Waiver and variance of rights and duties. Except as otherwise provided in Section 9-624, to the extent that they give rights to a debtor or obligor and impose duties on a secured party, the debtor or obligor may not waive or vary the rules stated in the following listed Sections:
        (1) Section 9-207(b)(4)(C), which deals with use and
    
operation of the collateral by the secured party;
        (2) Section 9-210, which deals with requests for an
    
accounting and requests concerning a list of collateral and statement of account;
        (3) Section 9-607(c), which deals with collection and
    
enforcement of collateral;
        (4) Sections 9-608(a) and 9-615(c) to the extent that
    
they deal with application or payment of noncash proceeds of collection, enforcement, or disposition;
        (5) Sections 9-608(a) and 9-615(d) to the extent that
    
they require accounting for or payment of surplus proceeds of collateral;
        (6) Section 9-609 to the extent that it imposes upon
    
a secured party that takes possession of collateral without judicial process the duty to do so without breach of the peace;
        (7) Sections 9-610(b), 9-611, 9-613, and 9-614, which
    
deal with disposition of collateral;
        (8) Section 9-615(f), which deals with calculation of
    
a deficiency or surplus when a disposition is made to the secured party, a person related to the secured party, or a secondary obligor;
        (9) Section 9-616, which deals with explanation of
    
the calculation of a surplus or deficiency;
        (10) Sections 9-620, 9-621, and 9-622, which deal
    
with acceptance of collateral in satisfaction of obligation;
        (11) Section 9-623, which deals with redemption of
    
collateral;
        (12) Section 9-624, which deals with permissible
    
waivers; and
        (13) Sections 9-625 and 9-626, which deal with the
    
secured party's liability for failure to comply with this Article.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-603

    (810 ILCS 5/9-603)
    Sec. 9-603. Agreement on standards concerning rights and duties.
    (a) Agreed standards. The parties may determine by agreement the standards measuring the fulfillment of the rights of a debtor or obligor and the duties of a secured party under a rule stated in Section 9-602 if the standards are not manifestly unreasonable.
    (b) Agreed standards inapplicable to breach of peace. Subsection (a) does not apply to the duty under Section 9-609 to refrain from breaching the peace.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-604

    (810 ILCS 5/9-604)
    Sec. 9-604. Procedure if security agreement covers real property or fixtures.
    (a) Enforcement: personal and real property. If a security agreement covers both personal and real property, a secured party may proceed:
        (1) under this Part as to the personal property
    
without prejudicing any rights with respect to the real property; or
        (2) as to both the personal property and the real
    
property in accordance with the rights with respect to the real property, in which case the other provisions of this Part do not apply.
    (b) Enforcement: fixtures. Subject to subsection (c), if a security agreement covers goods that are or become fixtures, a secured party may proceed:
        (1) under this Part; or
        (2) in accordance with the rights with respect to
    
real property, in which case the other provisions of this Part do not apply.
    (c) Removal of fixtures. Subject to the other provisions of this Part, if a secured party holding a security interest in fixtures has priority over all owners and encumbrancers of the real property, the secured party, after default, may remove the collateral from the real property.
    (d) Injury caused by removal. A secured party that removes collateral shall promptly reimburse any encumbrancer or owner of the real property, other than the debtor, for the cost of repair of any physical injury caused by the removal. The secured party need not reimburse the encumbrancer or owner for any diminution in value of the real property caused by the absence of the goods removed or by any necessity of replacing them. A person entitled to reimbursement may refuse permission to remove until the secured party gives adequate assurance for the performance of the obligation to reimburse.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-605

    (810 ILCS 5/9-605)
    Sec. 9-605. Unknown debtor or secondary obligor. A secured party does not owe a duty based on its status as secured party:
        (1) to a person that is a debtor or obligor, unless
    
the secured party knows:
            (A) that the person is a debtor or obligor;
            (B) the identity of the person; and
            (C) how to communicate with the person; or
        (2) to a secured party or lienholder that has filed a
    
financing statement against a person, unless the secured party knows:
            (A) that the person is a debtor; and
            (B) the identity of the person.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-606

    (810 ILCS 5/9-606)
    Sec. 9-606. Time of default for agricultural lien. For purposes of this Part, a default occurs in connection with an agricultural lien at the time the secured party becomes entitled to enforce the lien in accordance with the statute under which it was created.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-607

    (810 ILCS 5/9-607)
    Sec. 9-607. Collection and enforcement by secured party.
    (a) Collection and enforcement generally. If so agreed, and in any event after default, a secured party:
        (1) may notify an account debtor or other person
    
obligated on collateral to make payment or otherwise render performance to or for the benefit of the secured party;
        (2) may take any proceeds to which the secured party
    
is entitled under Section 9-315;
        (3) may enforce the obligations of an account debtor
    
or other person obligated on collateral and exercise the rights of the debtor with respect to the obligation of the account debtor or other person obligated on collateral to make payment or otherwise render performance to the debtor, and with respect to any property that secures the obligations of the account debtor or other person obligated on the collateral;
        (4) if it holds a security interest in a deposit
    
account perfected by control under Section 9-104(a)(1), may apply the balance of the deposit account to the obligation secured by the deposit account; and
        (5) if it holds a security interest in a deposit
    
account perfected by control under Section 9-104(a)(2) or (3), may instruct the bank to pay the balance of the deposit account to or for the benefit of the secured party.
    (b) Nonjudicial enforcement of mortgage. If necessary to enable a secured party to exercise under subsection (a)(3) the right of a debtor to enforce a mortgage nonjudicially, the secured party may record in the office in which a record of the mortgage is recorded:
        (1) a copy of the security agreement that creates or
    
provides for a security interest in the obligation secured by the mortgage; and
        (2) the secured party's sworn affidavit in recordable
    
form stating that:
            (A) a default has occurred with respect to the
        
obligation secured by the mortgage; and
            (B) the secured party is entitled to enforce the
        
mortgage nonjudicially.
    (c) Commercially reasonable collection and enforcement. A secured party shall proceed in a commercially reasonable manner if the secured party:
        (1) undertakes to collect from or enforce an
    
obligation of an account debtor or other person obligated on collateral; and
        (2) is entitled to charge back uncollected collateral
    
or otherwise to full or limited recourse against the debtor or a secondary obligor.
    (d) Expenses of collection and enforcement. A secured party may deduct from the collections made pursuant to subsection (c) reasonable expenses of collection and enforcement, including reasonable attorney's fees and legal expenses incurred by the secured party.
    (e) Duties to secured party not affected. This Section does not determine whether an account debtor, bank, or other person obligated on collateral owes a duty to a secured party.
(Source: P.A. 97-1034, eff. 7-1-13.)

810 ILCS 5/9-608

    (810 ILCS 5/9-608)
    Sec. 9-608. Application of proceeds of collection or enforcement; liability for deficiency and right to surplus.
    (a) Application of proceeds, surplus, and deficiency if obligation secured. If a security interest or agricultural lien secures payment or performance of an obligation, the following rules apply:
        (1) A secured party shall apply or pay over for
    
application the cash proceeds of collection or enforcement under Section 9-607 in the following order to:
            (A) the reasonable expenses of collection and
        
enforcement and, to the extent provided for by agreement and not prohibited by law, reasonable attorney's fees and legal expenses incurred by the secured party;
            (B) the satisfaction of obligations secured by
        
the security interest or agricultural lien under which the collection or enforcement is made; and
            (C) the satisfaction of obligations secured by
        
any subordinate security interest in or other lien on the collateral subject to the security interest or agricultural lien under which the collection or enforcement is made if the secured party receives an authenticated demand for proceeds before distribution of the proceeds is completed.
        (2) If requested by a secured party, a holder of a
    
subordinate security interest or other lien shall furnish reasonable proof of the interest or lien within a reasonable time. Unless the holder complies, the secured party need not comply with the holder's demand under paragraph (1)(C).
        (3) A secured party need not apply or pay over for
    
application noncash proceeds of collection and enforcement under Section 9-607 unless the failure to do so would be commercially unreasonable. A secured party that applies or pays over for application noncash proceeds shall do so in a commercially reasonable manner.
        (4) A secured party shall account to and pay a debtor
    
for any surplus, and the obligor is liable for any deficiency.
    (b) No surplus or deficiency in sales of certain rights to payment. If the underlying transaction is a sale of accounts, chattel paper, payment intangibles, or promissory notes, the debtor is not entitled to any surplus, and the obligor is not liable for any deficiency.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-609

    (810 ILCS 5/9-609)
    Sec. 9-609. Secured party's right to take possession after default.
    (a) Possession; rendering equipment unusable; disposition on debtor's premises. After default, a secured party:
        (1) may take possession of the collateral; and
        (2) without removal, may render equipment unusable
    
and dispose of collateral on a debtor's premises under Section 9-610.
    (b) Judicial and nonjudicial process. A secured party may proceed under subsection (a):
        (1) pursuant to judicial process; or
        (2) without judicial process, if it proceeds without
    
breach of the peace.
    (c) Assembly of collateral. If so agreed, and in any event after default, a secured party may require the debtor to assemble the collateral and make it available to the secured party at a place to be designated by the secured party which is reasonably convenient to both parties.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-610

    (810 ILCS 5/9-610)
    Sec. 9-610. Disposition of collateral after default.
    (a) Disposition after default. After default, a secured party may sell, lease, license, or otherwise dispose of any or all of the collateral in its present condition or following any commercially reasonable preparation or processing.
    (b) Commercially reasonable disposition. Every aspect of a disposition of collateral, including the method, manner, time, place, and other terms, must be commercially reasonable. If commercially reasonable, a secured party may dispose of collateral by public or private proceedings, by one or more contracts, as a unit or in parcels, and at any time and place and on any terms.
    (c) Purchase by secured party. A secured party may purchase collateral:
        (1) at a public disposition; or
        (2) at a private disposition only if the collateral
    
is of a kind that is customarily sold on a recognized market or the subject of widely distributed standard price quotations.
    (d) Warranties on disposition. A contract for sale, lease, license, or other disposition includes the warranties relating to title, possession, quiet enjoyment, and the like which by operation of law accompany a voluntary disposition of property of the kind subject to the contract.
    (e) Disclaimer of warranties. A secured party may disclaim or modify warranties under subsection (d):
        (1) in a manner that would be effective to disclaim
    
or modify the warranties in a voluntary disposition of property of the kind subject to the contract of disposition; or
        (2) by communicating to the purchaser a record
    
evidencing the contract for disposition and including an express disclaimer or modification of the warranties.
    (f) Record sufficient to disclaim warranties. A record is sufficient to disclaim warranties under subsection (e) if it indicates "There is no warranty relating to title, possession, quiet enjoyment, or the like in this disposition" or uses words of similar import.
    (g) The provisions of this Section are subject to Section 26.5 of the Retail Installment Sales Act.
(Source: P.A. 97-913, eff. 1-1-13.)

810 ILCS 5/9-611

    (810 ILCS 5/9-611)
    Sec. 9-611. Notification before disposition of collateral.
    (a) "Notification date." In this Section, "notification date" means the earlier of the date on which:
        (1) a secured party sends to the debtor and any
    
secondary obligor an authenticated notification of disposition; or
        (2) the debtor and any secondary obligor waive the
    
right to notification.
    (b) Notification of disposition required. Except as otherwise provided in subsection (d), a secured party that disposes of collateral under Section 9-610 shall send to the persons specified in subsection (c) a reasonable authenticated notification of disposition.
    (c) Persons to be notified. To comply with subsection (b), the secured party shall send an authenticated notification of disposition to:
        (1) the debtor;
        (2) any secondary obligor; and
        (3) if the collateral is other than consumer goods:
            (A) any other person from which the secured party
        
has received, before the notification date, an authenticated notification of a claim of an interest in the collateral;
            (B) any other secured party or lienholder that,
        
10 days before the notification date, held a security interest in or other lien on the collateral perfected by the filing of a financing statement that:
                (i) identified the collateral;
                (ii) was indexed under the debtor's name as
            
of that date; and
                (iii) was filed in the office in which to
            
file a financing statement against the debtor covering the collateral as of that date; and
            (C) any other secured party that, 10 days before
        
the notification date, held a security interest in the collateral perfected by compliance with a statute, regulation, or treaty described in Section 9-311(a).
    (d) Subsection (b) inapplicable: perishable collateral; recognized market. Subsection (b) does not apply if the collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market.
    (e) Compliance with subsection (c)(3)(B). A secured party complies with the requirement for notification prescribed by subsection (c)(3)(B) if:
        (1) not later than 20 days or earlier than 30 days
    
before the notification date, the secured party requests, in a commercially reasonable manner, information concerning financing statements indexed under the debtor's name in the office indicated in subsection (c)(3)(B); and
        (2) before the notification date, the secured party:
            (A) did not receive a response to the request for
        
information; or
            (B) received a response to the request for
        
information and sent an authenticated notification of disposition to each secured party or other lienholder named in that response whose financing statement covered the collateral.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-612

    (810 ILCS 5/9-612)
    Sec. 9-612. Timeliness of notification before disposition of collateral.
    (a) Reasonable time is question of fact. Except as otherwise provided in subsection (b), whether a notification is sent within a reasonable time is a question of fact. The limitation of the rule in subsection (b) to transactions other than consumer-goods transactions is intended to leave to the court the determination of the proper rules in consumer-goods transactions. The court may not infer from that limitation the nature of the proper rule in consumer-goods transactions and may continue to apply established approaches.
    (b) 10-day period sufficient in non-consumer transaction. In a transaction other than a consumer transaction, a notification of disposition sent after default and 10 days or more before the earliest time of disposition set forth in the notification is sent within a reasonable time before the disposition.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-613

    (810 ILCS 5/9-613)
    Sec. 9-613. Contents and form of notification before disposition of collateral: general. Except in a consumer-goods transaction, the following rules apply:
        (1) The contents of a notification of disposition are
    
sufficient if the notification:
            (A) describes the debtor and the secured party;
            (B) describes the collateral that is the subject
        
of the intended disposition;
            (C) states the method of intended disposition;
            (D) states that the debtor is entitled to an
        
accounting of the unpaid indebtedness and states the charge, if any, for an accounting; and
            (E) states the time and place of a public
        
disposition or the time after which any other disposition is to be made.
        (2) Whether the contents of a notification that lacks
    
any of the information specified in paragraph (1) are nevertheless sufficient is a question of fact.
        (3) The contents of a notification providing
    
substantially the information specified in paragraph (1) are sufficient, even if the notification is accompanied by or combined other notification or includes:
            (A) information not specified by that paragraph;
        
or
            (B) minor errors that are not seriously
        
misleading.
        (4) A particular phrasing of the notification is not
    
required.
        (5) The following form of notification and the form
    
appearing in Section 9-614(4), when completed, each provides sufficient information:
NOTIFICATION OF DISPOSITION OF COLLATERAL
        To: ..................................... (Name of
    
debtor, obligor, or other person to which the notification is sent)
        From: ................................... (Name,
    
address, and telephone number of secured party)
        Name of Debtor(s): ..................... (Include
    
only if debtor(s) are not an addressee)

 
        For a public disposition:
        We will sell or lease or license, as applicable, the
    
............................ (describe collateral) to the highest qualified bidder in public as follows:
        Day and Date: ...................................
        Time: ...........................................
        Place: ..........................................
 
        For a private disposition:
        We will sell (or lease or license, as applicable) the
    
........................... (describe collateral) privately sometime after ................ (day and date).
        You are entitled to an accounting of the unpaid
    
indebtedness secured by the property that we intend to sell or lease or license, as applicable for a charge of $................. You may request an accounting by calling us at .................. (telephone number).
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-614

    (810 ILCS 5/9-614)
    Sec. 9-614. Contents and form of notification before disposition of collateral: consumer-goods transaction. In a consumer-goods transaction, the following rules apply:
        (1) A notification of disposition must provide the
    
following information:
            (A) the information specified in Section 9-613(1);
            (B) a description of any liability for a
        
deficiency of the person to which the notification is sent;
            (C) a telephone number from which the amount that
        
must be paid to the secured party to redeem the collateral under Section 9-623 is available; and
            (D) a telephone number or mailing address from
        
which additional information concerning the disposition and the obligation secured is available.
        (2) A particular phrasing of the notification is not
    
required.
        (3) The contents of a notification providing
    
substantially the information specified in paragraph (1) are sufficient, even if the notification:
            (A) is accompanied by or combined with other
        
notifications;
            (B) includes information not specified by that
        
paragraph; or
            (C) includes minor errors that are not seriously
        
misleading.
        (4) The following form of notification, when
    
completed, provides sufficient information:
    ............. (Name and address of secured party)
    ............. (Date)
NOTICE OF OUR PLAN TO SELL PROPERTY
    ......................................................
    (Name and address of any obligor who is also a debtor)
    Subject: ..................................
    (Identification of Transaction)
        We have your ..................... (describe
    
collateral), because you broke promises in our agreement.

 
        For a public disposition:
        We will sell ....................... (describe
    
collateral) at public sale. A sale could include a lease or license. The sale will be held as follows:
    Date:  ................................
    Time:  ................................
    Place: ................................
        You may attend the sale and bring bidders if you want.
 
        For a private disposition:
        We will sell ........................... (describe
    
collateral) at private sale sometime after .................... (date). A sale could include a lease or license.
        The money that we get from the sale (after paying our
    
costs) will reduce the amount you owe. If we get less money than you owe, you ............ (will or will not, as applicable) still owe us the difference. If we get more money than you owe, you will get the extra money, unless we must pay it to someone else.
        You can get the property back at any time before we
    
sell it by paying us the full amount you owe (not just the past due payments), including our expenses. To learn the exact amount you must pay, call us at ................ (telephone number).
        If you want us to explain to you in writing how we
    
have figured the amount that you owe us, you may call us at .................. (telephone number) or write us at .................................... (secured party's address) and request a written explanation. We will charge you $ ........... for the explanation if we sent you another written explanation of the amount you owe us within the last six months.
        If you need more information about the sale call us
    
at .................. (telephone number) or write us at ......................... (secured party's address).
        We are sending this notice to the following other
    
people who have an interest ...................... (describe collateral) or who owe money under your agreement:
    .................................................
    (Names of all other debtors and obligors, if any)
        (5) A notification in the form of paragraph (4) is
    
sufficient, even if it includes errors in information not required by paragraph (1).
        (6) If a notification under this Section is not in
    
the form of paragraph (4), law other than this Article determines the effect of including information not required by paragraph (1).
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-615

    (810 ILCS 5/9-615)
    Sec. 9-615. Application of proceeds of disposition; liability for deficiency and right to surplus.
    (a) Application of proceeds. A secured party shall apply or pay over for application the cash proceeds of disposition in the following order to:
        (1) the reasonable expenses of retaking, holding,
    
preparing for disposition, processing, and disposing, and, to the extent provided for by agreement and not prohibited by law, reasonable attorney's fees and legal expenses incurred by the secured party;
        (2) the satisfaction of obligations secured by the
    
security interest or agricultural lien under which the disposition is made;
        (3) the satisfaction of obligations secured by any
    
subordinate security interest in or other subordinate lien on the collateral if:
            (A) the secured party receives from the holder of
        
the subordinate security interest or other lien an authenticated demand for proceeds before distribution of the proceeds is completed; and
            (B) in a case in which a consignor has an
        
interest in the collateral, the subordinate security interest or other lien is senior to the interest of the consignor; and
        (4) a secured party that is a consignor of the
    
collateral if the secured party receives from the consignor an authenticated demand for proceeds before distribution of the proceeds is completed.
    (b) Proof of subordinate interest. If requested by a secured party, a holder of a subordinate security interest or other lien shall furnish reasonable proof of the interest or lien within a reasonable time. Unless the holder does so, the secured party need not comply with the holder's demand under subsection (a)(3).
    (c) Application of noncash proceeds. A secured party need not apply or pay over for application noncash proceeds of disposition under this Section unless the failure to do so would be commercially unreasonable. A secured party that applies or pays over for application noncash proceeds shall do so in a commercially reasonable manner.
    (d) Surplus or deficiency if obligation secured. If the security interest under which a disposition is made secures payment or performance of an obligation, after making the payments and applications required by subsection (a) and permitted by subsection (c):
        (1) unless subsection (a)(4) requires the secured
    
party to apply or pay over cash proceeds to a consignor, the secured party shall account to and pay a debtor for any surplus; and
        (2) the obligor is liable for any deficiency.
    (e) No surplus or deficiency in sales of certain rights to payment. If the underlying transaction is a sale of accounts, chattel paper, payment intangibles, or promissory notes:
        (1) the debtor is not entitled to any surplus; and
        (2) the obligor is not liable for any deficiency.
    (f) Calculation of surplus or deficiency in disposition to person related to secured party. The surplus or deficiency following a disposition is calculated based on the amount of proceeds that would have been realized in a disposition complying with this Part and described in subsection (f)(2) of this Section to a transferee other than the secured party, a person related to the secured party, or a secondary obligor if:
        (1) the transferee in the disposition is the secured
    
party, a person related to the secured party, or a secondary obligor; and
        (2) the amount of proceeds of the disposition is
    
significantly below the range of proceeds that would have been received from a complying disposition by a forced sale without reserve to a willing buyer other than the secured party, a person related to the secured party, or a secondary obligor.
    (g) Cash proceeds received by junior secured party. A secured party that receives cash proceeds of a disposition in good faith and without knowledge that the receipt violates the rights of the holder of a security interest or other lien that is not subordinate to the security interest or agricultural lien under which the disposition is made:
        (1) takes the cash proceeds free of the security
    
interest or other lien;
        (2) is not obligated to apply the proceeds of the
    
disposition to the satisfaction of obligations secured by the security interest or other lien; and
        (3) is not obligated to account to or pay the holder
    
of the security interest or other lien for any surplus.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-616

    (810 ILCS 5/9-616)
    Sec. 9-616. Explanation of calculation of surplus or deficiency.
    (a) Definitions. In this Section:
        (1) "Explanation" means a writing that:
            (A) states whether a surplus or deficiency is
        
owed and the amount of the surplus, if applicable;
            (B) states, if applicable, that future debits,
        
credits, charges, including additional credit service charges or interest, rebates, and expenses may affect the amount of the surplus or deficiency;
            (C) provides a telephone number or mailing
        
address from which the debtor or consumer obligor may obtain additional information concerning the transaction and from which such person may request the amount of the deficiency and further information regarding how the secured party calculated the surplus or deficiency; and
            (D) at the sender's option, the information set
        
forth in subsection (c).
        (2) "Request" means a record:
            (A) authenticated by a debtor or consumer obligor;
            (B) requesting that the recipient provide
        
information of how it calculated the surplus or deficiency; and
            (C) sent after disposition of the collateral
        
under Section 9-610.
    (b) Explanation of calculation. In a consumer-goods transaction in which the debtor is entitled to a surplus or a consumer obligor is liable for a deficiency under Section 9-615, the secured party shall:
        (1) send an explanation to the debtor or consumer
    
obligor, as applicable, after the disposition and:
            (A) before or when the secured party accounts to
        
the debtor and pays any surplus or first makes written demand on the consumer obligor after the disposition for payment of the deficiency, other than in instances in which such demand is made by a third-party debt collector covered by the Fair Debt Collection Practices Act; and
            (B) within 14 days after receipt of a request
        
made by the debtor or consumer obligor within one year after the secured party has given an explanation under this Section or notice to such debtor or consumer obligor under Section 9-614 of this Article; or
        (2) in the case of a consumer obligor who is liable
    
for a deficiency, within 14 days after receipt of a request, send to the consumer obligor a record waiving the secured party's right to a deficiency.
    (c) Required information for response to request. To comply with a request, the secured party must provide a response in writing which includes the following information:
        (1) the aggregate amount of obligations secured by
    
the security interest under which the disposition was made, and, if the amount reflects a rebate of unearned interest or credit service charge, an indication of that fact, calculated as of a specified date:
            (A) if the secured party takes or receives
        
possession of the collateral after default, not more than 35 days before the secured party takes or receives possession; or
            (B) if the secured party takes or receives
        
possession of the collateral before default or does not take possession of the collateral, not more than 35 days before the disposition;
        (2) the amount of proceeds of the disposition;
        (3) the aggregate amount of the obligations after
    
deducting the amount of proceeds;
        (4) the amount, in the aggregate or by type, and
    
types of expenses, including expenses of retaking, holding, preparing for disposition, processing, and disposing of the collateral, and attorney's fees secured by the collateral which are known to the secured party and relate to the current disposition;
        (5) the amount, in the aggregate or by type, and
    
types of credits, including rebates of interest or credit service charges, to which the obligor is known to be entitled and which are not reflected in the amount in paragraph (1); and
        (6) the amount of the surplus or deficiency.
    (d) Substantial compliance. A particular phrasing of the explanation or response to a request is not required. An explanation or a response to a request complying substantially with the requirements of this Section is sufficient even if it is:
        (1) accompanied by or combined with other
    
notifications;
        (2) includes information not specified by this
    
Section;
        (3) includes minor errors that are not seriously
    
misleading; or
        (4) includes errors in information not required by
    
this Section.
    (e) Charges for responses. A debtor or consumer obligor is entitled without charge to one response to a request under this Section during any six-month period in which the secured party did not send to the debtor or consumer obligor an explanation pursuant to subsection (b)(1). The secured party may require payment of a charge not exceeding $25 for each additional response.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-617

    (810 ILCS 5/9-617)
    Sec. 9-617. Rights of transferee of collateral.
    (a) Effects of disposition. A secured party's disposition of collateral after default:
        (1) transfers to a transferee for value all of the
    
debtor's rights in the collateral;
        (2) discharges the security interest under which the
    
disposition is made; and
        (3) discharges any subordinate security interest or
    
other subordinate lien.
    (b) Rights of good-faith transferee. A transferee that acts in good faith takes free of the rights and interests described in subsection (a), even if the secured party fails to comply with this Article or the requirements of any judicial proceeding.
    (c) Rights of other transferee. If a transferee does not take free of the rights and interests described in subsection (a), the transferee takes the collateral subject to:
        (1) the debtor's rights in the collateral;
        (2) the security interest or agricultural lien under
    
which the disposition is made; and
        (3) any other security interest or other lien.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-618

    (810 ILCS 5/9-618)
    Sec. 9-618. Rights and duties of certain secondary obligors.
    (a) Rights and duties of secondary obligor. A secondary obligor acquires the rights and becomes obligated to perform the duties of the secured party after the secondary obligor:
        (1) receives an assignment of a secured obligation
    
from the secured party;
        (2) receives a transfer of collateral from the
    
secured party and agrees to accept the rights and assume the duties of the secured party; or
        (3) is subrogated to the rights of a secured party
    
with respect to collateral.
    (b) Effect of assignment, transfer, or subrogation. An assignment, transfer, or subrogation described in subsection (a):
        (1) is not a disposition of collateral under Section
    
9-610; and
        (2) relieves the secured party of further duties
    
under this Article.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-619

    (810 ILCS 5/9-619)
    Sec. 9-619. Transfer of record or legal title.
    (a) "Transfer statement." In this Section, "transfer statement" means a record authenticated by a secured party stating:
        (1) that the debtor has defaulted in connection with
    
an obligation secured by specified collateral;
        (2) that the secured party has exercised its
    
post-default remedies with respect to the collateral;
        (3) that, by reason of the exercise, a transferee has
    
acquired the rights of the debtor in the collateral; and
        (4) the name and mailing address of the secured
    
party, debtor, and transferee.
    (b) Effect of transfer statement. A transfer statement entitles the transferee to the transfer of record of all rights of the debtor in the collateral specified in the statement in any official filing, recording, registration, or certificate-of-title system covering the collateral. If a transfer statement is presented with the applicable fee and request form to the official or office responsible for maintaining the system, the official or office shall:
        (1) accept the transfer statement;
        (2) promptly amend its records to reflect the
    
transfer; and
        (3) if applicable, issue a new appropriate
    
certificate of title in the name of the transferee.
    (c) Transfer not a disposition; no relief of secured party's duties. A transfer of the record or legal title to collateral to a secured party under subsection (b) or otherwise is not of itself a disposition of collateral under this Article and does not of itself relieve the secured party of its duties under this Article.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-620

    (810 ILCS 5/9-620)
    Sec. 9-620. Acceptance of collateral in full or partial satisfaction of obligation; compulsory disposition of collateral.
    (a) Conditions to acceptance in satisfaction. Except as otherwise provided in subsection (g), a secured party may accept collateral in full or partial satisfaction of the obligation it secures only if:
        (1) the debtor consents to the acceptance under
    
subsection (c);
        (2) the secured party does not receive, within the
    
time set forth in subsection (d), a notification of objection to the proposal authenticated by:
            (A) a person to which the secured party was
        
required to send a proposal under Section 9-621; or
            (B) any other person, other than the debtor,
        
holding an interest in the collateral subordinate to the security interest that is the subject of the proposal;
        (3) if the collateral is consumer goods, the
    
collateral is not in the possession of the debtor when the debtor consents to the acceptance; and
        (4) subsection (e) does not require the secured party
    
to dispose of the collateral or the debtor waives the requirement pursuant to Section 9-624.
    (b) Purported acceptance ineffective. A purported or apparent acceptance of collateral under this Section is ineffective unless:
        (1) the secured party consents to the acceptance in
    
an authenticated record or sends a proposal to the debtor; and
        (2) the conditions of subsection (a) are met.
    (c) Debtor's consent. For purposes of this Section:
        (1) a debtor consents to an acceptance of collateral
    
in partial satisfaction of the obligation it secures only if the debtor agrees to the terms of the acceptance in a record authenticated after default; and
        (2) a debtor consents to an acceptance of collateral
    
in full satisfaction of the obligation it secures only if the debtor agrees to the terms of the acceptance in a record authenticated after default or the secured party:
            (A) sends to the debtor after default a proposal
        
that is unconditional or subject only to a condition that collateral not in the possession of the secured party be preserved or maintained;
            (B) in the proposal, proposes to accept
        
collateral in full satisfaction of the obligation it secures; and
            (C) does not receive a notification of objection
        
authenticated by the debtor within 20 days after the proposal is sent.
    (d) Effectiveness of notification. To be effective under subsection (a)(2), a notification of objection must be received by the secured party:
        (1) in the case of a person to which the proposal was
    
sent pursuant to Section 9-621, within 20 days after notification was sent to that person; and
        (2) in other cases:
            (A) within 20 days after the last notification
        
was sent pursuant to Section 9-621; or
            (B) if a notification was not sent, before the
        
debtor consents to the acceptance under subsection (c).
    (e) Mandatory disposition of consumer goods. A secured party that has taken possession of collateral shall dispose of the collateral pursuant to Section 9-610 within the time specified in subsection (f) if:
        (1) 60 percent of the cash price has been paid in the
    
case of a purchase-money security interest in consumer goods; or
        (2) 60 percent of the principal amount of the
    
obligation secured has been paid in the case of a non-purchase-money security interest in consumer goods.
    (f) Compliance with mandatory disposition requirement. To comply with subsection (e), the secured party shall dispose of the collateral:
        (1) within 90 days after taking possession; or
        (2) within any longer period to which the debtor and
    
all secondary obligors have agreed in an agreement to that effect entered into and authenticated after default.
    (g) No partial satisfaction in consumer transaction. In a consumer transaction, a secured party may not accept collateral in partial satisfaction of the obligation it secures.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-621

    (810 ILCS 5/9-621)
    Sec. 9-621. Notification of proposal to accept collateral.
    (a) Persons to which proposal to be sent. A secured party that desires to accept collateral in full or partial satisfaction of the obligation it secures shall send its proposal to:
        (1) any person from which the secured party has
    
received, before the debtor consented to the acceptance, an authenticated notification of a claim of an interest in the collateral;
        (2) any other secured party or lienholder that, 10
    
days before the debtor consented to the acceptance, held a security interest in or other lien on the collateral perfected by the filing of a financing statement that:
            (A) identified the collateral;
            (B) was indexed under the debtor's name as of
        
that date; and
            (C) was filed in the office or offices in which
        
to file a financing statement against the debtor covering the collateral as of that date; and
        (3) any other secured party that, 10 days before the
    
debtor consented to the acceptance, held a security interest in the collateral perfected by compliance with a statute, regulation, or treaty described in Section 9-311(a).
    (b) Proposal to be sent to secondary obligor in partial satisfaction. A secured party that desires to accept collateral in partial satisfaction of the obligation it secures shall send its proposal to any secondary obligor in addition to the persons described in subsection (a).
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-622

    (810 ILCS 5/9-622)
    Sec. 9-622. Effect of acceptance of collateral.
    (a) Effect of acceptance. A secured party's acceptance of collateral in full or partial satisfaction of the obligation it secures:
        (1) discharges the obligation to the extent consented
    
to by the debtor;
        (2) transfers to the secured party all of a debtor's
    
rights in the collateral;
        (3) discharges the security interest or agricultural
    
lien that is the subject of the debtor's consent and any subordinate security interest or other subordinate lien; and
        (4) terminates any other subordinate interest.
    (b) Discharge of subordinate interest notwithstanding noncompliance. A subordinate interest is discharged or terminated under subsection (a), even if the secured party fails to comply with this Article.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-623

    (810 ILCS 5/9-623)
    Sec. 9-623. Right to redeem collateral.
    (a) Persons that may redeem. A debtor, any secondary obligor, or any other secured party or lienholder may redeem collateral.
    (b) Requirements for redemption. To redeem collateral, a person shall tender:
        (1) fulfillment of all obligations secured by the
    
collateral; and
        (2) the reasonable expenses and attorney's fees
    
described in Section 9-615(a)(1).
    (c) When redemption may occur. A redemption may occur at any time before a secured party:
        (1) has collected collateral under Section 9-607;
        (2) has disposed of collateral or entered into a
    
contract for its disposition under Section 9-610; or
        (3) has accepted collateral in full or partial
    
satisfaction of the obligation it secures under Section 9-622.
(Source: P.A. 91-893, eff. 7-1-01.)

810 ILCS 5/9-624

    (810 ILCS 5/9-624)
    Sec. 9-624. Waiver.
    (a) Waiver of disposition notification. A debtor or secondary obligor may waive the right to notification of disposition of collateral under Section 9-611 only by an agreement to that effect entered into and authenticated after default.
    (b) Waiver of mandatory disposition. A debtor may waive the right to require disposition of collateral under Section 9-620(e) only by an agreement to that effect entered into and authenticated after default.
    (c) Waiver of redemption right. A debtor or secondary obligor may waive the right to redeem collateral under Section 9-623 only by an agreement to that effect entered into and authenticated after default.
(Source: P.A. 91-893, eff. 7-1-01.)