§ 554.9207

554.9207 Rights and duties of secured party having possession or control of collateral. 1. Duty of care when secured party in possession. Except as otherwise provided in subsection 4, a secured party shall use reasonable care in the custody and preservation ofcollateral in the secured party’s possession. In the case of chattel paper or an instrument,reasonable care includes taking necessary steps to preserve rights against prior partiesunless otherwise agreed. 2. Expenses, risks, duties, and rights when secured party in possession. Except as otherwise provided in subsection 4, if a secured party has possession of collateral: a. reasonable expenses, including the cost of insurance and payment of taxes or other charges, incurred in the custody, preservation, use, or operation of the collateral arechargeable to the debtor and are secured by the collateral; b. the risk of accidental loss or damage is on the debtor to the extent of a deficiency in any effective insurance coverage; c. the secured party shall keep the collateral identifiable, but fungible collateral may be commingled; and d.

mage is on the debtor to the extent of a deficiency in any effective insurance coverage; c. the secured party shall keep the collateral identifiable, but fungible collateral may be commingled; and d. the secured party may use or operate the collateral:(1) for the purpose of preserving the collateral or its value;(2) as permitted by an order of a court having competent jurisdiction; or(3) except in the case of consumer goods, in the manner and to the extent agreed by the debtor. 3. Duties and rights when secured party in possession or control. Except as otherwise provided in subsection 4, a secured party having possession of collateral or control ofcollateral under section 554.7106, 554.9104, 554.9105, 554.9105A, 554.9106, 554.9107, or554.9107A: a. may hold as additional security any proceeds, except money or funds, received from the collateral; b. shall apply money or funds received from the collateral to reduce the secured obligation, unless remitted to the debtor; and c. may create a security interest in the collateral.4. Buyer of certain rights to payment. If the secured party is a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor: a.

te a security interest in the collateral.4. Buyer of certain rights to payment. If the secured party is a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor: a. subsection 1 does not apply unless the secured party is entitled under an agreement:(1) to charge back uncollected collateral; or(2) otherwise to full or limited recourse against the debtor or a secondary obligor based on the nonpayment or other default of an account debtor or other obligor on the collateral;and b. subsections 2 and 3 do not apply.2000 Acts, ch 1149, §17, 185, 187; 2007 Acts, ch 30, §45, 46, 67; 2022 Acts, ch 1117, §20Referred to in §554.9601, 554.9602 Sat Dec 23 11:01:39 2023 Iowa Code 2024, Section 554.9207 (27, 0)