Asked by Aeryn Brewer on May 16, 2024
Verified
Overextended Debtor.Dennis purchased a big-screen television from ABC Electronics and financed the purchase through ABC Electronics based on an agreement granting ABC Electronics a security interest in the television and requiring that Dennis make monthly payments.Three months later,Dennis was unable to continue making payments on the television because he had bought a boat,a new car,an expensive engagement ring for his girlfriend,and some other items.The manager from ABC Electronics called and asked Dennis to return the television.Dennis refused on the basis that ABC Electronics never perfected its interest in the television.Which of the following is the correct term for designating the effect of Dennis's failure to continue making payments?
A) He refused the loan.
B) He defaulted on the loan.
C) He unsecured the loan.
D) He rescinded the loan.
E) He discharged the loan.
Defaulted On The Loan
A situation in which a borrower fails to make the agreed-upon payments on a loan within the specified time, leading to a breach of the loan agreement.
Security Interest
A legal claim or right granted to a creditor over the debtor's assets as collateral for a loan.
Monthly Payments
Regular payments made once a month, often in the context of loans, rent, or subscriptions.
- Evaluate the claims and obligations of parties in transactions protected by personal assets.
Verified Answer
DW
Devon WarrenMay 22, 2024
Final Answer :
B
Explanation :
Default is the failure to make payments on a loan.
Learning Objectives
- Evaluate the claims and obligations of parties in transactions protected by personal assets.