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Simple English definitions for legal terms
electronic chattel paper
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A quick definition of electronic chattel paper:
Electronic Chattel Paper: A type of document that shows that someone owes money and has a right to specific goods. It is often used when someone buys something on credit and promises to pay for it later. The seller keeps a record of this promise and their right to take back the goods if the buyer doesn't pay. Electronic chattel paper is just like regular chattel paper, but it is stored and accessed electronically instead of on paper.
A more thorough explanation:
Electronic chattel paper is a type of legal document that shows both a monetary obligation and a security interest in or a lease of specific goods. It is similar to traditional chattel paper, which is used in consumer transactions when someone buys goods on credit and promises to pay for them by executing a promissory note.
For example, if you buy a car on credit, the seller may retain a security interest in the car until you pay off the loan. The legal document that shows this agreement is called chattel paper. If the same agreement is made electronically, it is called electronic chattel paper.
Another example of electronic chattel paper is when a company leases equipment to another company and retains a security interest in the equipment until the lease is paid off. The legal document that shows this agreement is also considered electronic chattel paper.
Overall, electronic chattel paper is a way to legally document agreements related to specific goods and monetary obligations in an electronic format.