Pennsylvania § 9323 - Future advances.

§ 9323. Future advances.

(a) When priority based on time of advance.--Except as otherwise provided in subsection (c), for purposes of determining the priority of a perfected security interest under section 9322(a)(1) (relating to general priority rules), perfection of the security interest dates from the time an advance is made to the extent that the security interest secures an advance which:

(1) is made while the security interest is perfected only:

(i) under section 9309 (relating to security interest perfected upon attachment) when it attaches; or

(ii) temporarily under any of the following sections:

(A) 9312(e) (relating to perfection of security interests in chattel paper, controllable accounts, controllable electronic records, controllable payment intangibles, deposit accounts, documents, goods covered by documents, instruments, investment property, letter-of-credit rights and money; perfection by permissive filing; temporary perfection without filing or transfer of possession);

(B) 9312(f); or

(C) 9312(g); and

(2) is not made pursuant to a commitment entered into before or while the security interest is perfected by a method other than under section 9309 or 9312(e), (f) or (g).

(b) Lien creditor.--Except as otherwise provided in subsection (c), a security interest is subordinate to the rights of a person that becomes a lien creditor to the extent that the security interest secures an advance made more than 45 days after the person becomes a lien creditor unless the advance is made:

(1) without knowledge of the lien; or

(2) pursuant to a commitment entered into without knowledge of the lien.

(c) Buyer of receivables.--Subsections (a) and (b) do not apply to a security interest held by a secured party that is a buyer of accounts, chattel paper, payment intangibles or promissory notes or a consignor.

(d) Buyer of goods.--Except as otherwise provided in subsection (e), a buyer of goods takes free of a security interest to the extent that it secures advances made after the earlier of:

(1) the time the secured party acquires knowledge of the buyer's purchase; or

(2) 45 days after the purchase.

(e) Advances made pursuant to commitment: priority of buyer of goods.--Subsection (d) does not apply if the advance is made pursuant to a commitment entered into without knowledge of the buyer's purchase and before the expiration of the 45-day period.

(f) Lessee of goods.--Except as otherwise provided in subsection (g), a lessee of goods takes the leasehold interest free of a security interest to the extent that it secures advances made after the earlier of:

(1) the time the secured party acquires knowledge of the lease; or

(2) 45 days after the lease contract becomes enforceable.

(g) Advances made pursuant to commitment: priority of lessee of goods.--Subsection (f) does not apply if the advance is made pursuant to a commitment entered into without knowledge of the lease and before the expiration of the 45-day period.

(July 1, 2024, P.L.450, No.41, eff. 60 days)

2024 Amendment. Act 41 amended subsecs. (a)(1)(ii), (d) and (f). See section 1 of Act 41 in the appendix to this title for special provisions relating to findings and declarations.

Cross References. Section 9323 is referred to in sections 2A307, 9328 of this title.