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Suppose a car dealer borrowed money from a bank. As security for the loan, the dealer signed a written agreement that both specified the terms of the loan and included the following language: "The dealer hereby grants to the bank a security interest in all of its inventory." End quote. Does the bank have a valid security interest in the dealer's inventory? In another lesson, we learned that Revised Article 9 of the Uniform Commercial Code (UCC) governs all secured transactions, that is, transactions that create a security interest.
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