Legal Question in Credit and Debt Law in Pennsylvania

Re: Personal Loan - UCC Filing

Listen very closely...DO NOT LEND YOUR FRIEND MONEY. Nothing will help you if he goes bankrupt. Even if he doesn't and simply does not pay (and you have ALL your protections in place) you will STILL have tons of expenses and aggravation...and NO $$. You would have to enforce your agreement, get a judgment and find assets (is he working?), my guess is he wouldn't need you if he was gainfully employed...AVOID THE HASSLES. Deal with his anger NOW, while you have your funds...INSTEAD of later when you are BOTH ANGRY and you are OUT the money. Blame me for it..Blame the economy...just DON'T BE A MONEY LENDER FRIEND...the friendship suffers...

Re: Personal Loan - UCC Filing

I agree with Guy. However, to specifically answer your questions:

Q1. Should I also file a UCC1 on ''any and all assets and property'' of the borrower in PA? Will this help me if he goes bankrupt?

A. It will make you a secured creditor with those assets. However, even secured creditors may not recover on a bankruptcy, especially if money is owed for taxes (government comes first). Furthermore UCC-1 is not a security on real property. You would have to file a mortgage.

Q2. We are specifying in the contract that NY law controls, and we will use NY courts if it comes to that. If I file a UCC in PA, will I have to sue him in PA if he doesn't pay, or can we still use NY courts?

A. You may use the NY courts since under the agreement you specified venue (NY Courts) and law (NY).

Mike.