Also known as: lien creditor · secured creditors
Written by attorneys · grounded in primary & secondary sources — see below
A creditor who has obtained a lien on a debtor's property by judicial process or by operation of a statute. The lien gives the creditor rights in the property that can prevail over an unperfected security interest.
Legacy Motors sold equipment to Lucia Lopez under a purchase-money arrangement that created an attached security interest. Legacy Motors delivered the equipment on day one but filed its financing statement on day twenty-two. During the gap a judgment creditor obtained a lien on the equipment. The judgment creditor's lien takes priority because the filing occurred outside the twenty-day grace period.
Linden Bank financed Lorenzo Lugo's purchase of a truck and relied on the state certificate-of-title statute to perfect its interest. A judgment creditor later obtained a lien on the truck. Because the title statute expressly governs priority over lien creditors, the bank's interest prevails without a separate Article 9 filing.
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A lien creditor prevails over an unperfected security interest. The lien creditor also prevails over a purchase-money security interest if the secured party files more than twenty days after the debtor receives the collateral.
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Yes. Filing before or within twenty days after the debtor receives delivery gives the purchase-money secured party priority over a lien creditor whose rights arose in the gap period.
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A statute that requires indication of a security interest on a certificate of title as a condition of priority over lien creditors preempts the ordinary Article 9 filing rules.
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…these monthly wage assignments to pay, in order of priority: (1) administrative costs; (2) the IRS's priority tax claim; (3) secured creditors' claims; and finally, (4) unsecured creditors' claims. Id. , at 77a-79a. The proposed plan also provided that petitioners would pay interest on the secured portion of respondent's claim…