Securities Account Control Agreements

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The Account Control Agreement — an agreement that enhances a creditor`s interest in a title account, while allowing the registration of securities on behalf of the owner. An account control agreement is used to establish a security interest that… Financial and Commercial Terms The underlying title account control agreements are of all shapes and sizes, and it is necessary to have a fundamental understanding of what you need to pay attention to when reviewing these agreements. These agreements are generally between the owner/pledgor (“Pledgor”) of the Securities Account, the securities intermediary (i.e.dem broker or bank in which the securities account is held, the “broker”) and the lender (“Lender”). There are a large number of business risks arising from some of the existing sector control agreements, and as title accounts are increasingly part of collateral for commercial loans, we felt that this was a dignified issue for bank loan managers and employees. The code provides that “control” of a securities account is the preferred method for developing a securities interest in a securities account. An insured party may also enhance its security interest by filing a UCC funding statement against the Pledgor covering the title account, but such a UCC bid is being established by an insured party that takes “control” of the securities account. A UCC submission is a useful method of perfection for lenders who have a second primary interest in a title account and cannot obtain a subordinate “control” over such an account, either because the primary lender or broker do not allow such subordinated securities interest. We are pleased to welcome lawyer Bennett Cohen of the law firm Cohen, Salk and Huvard, P.C. as a guest blogger! In the coming weeks, Mr.

Cohen will share his expertise on the control agreements for mortgaged title accounts. Be sure to check next week, as Mr. Cohen continues to dive into the mortgaged title account control agreements. Looking for more educational resources? Visit the First Corporate Solutions resource library to download documents on business transactions, UCC submissions, pledge fees and more. As a general rule, a lender that improves the interest of a title account through “control” must receive a written tripartite control agreement signed by the Pledgor, the broker and the lender, which contains an appropriate “control language” (see below). Another method of “control” is to securitize the title account on behalf of the lender (which other method may be problematic and not fall within the scope of this article). Account – a record of a business transaction. If you buy something on credit, the company you`re dealing with creates an account. This means that it establishes a record of what you buy and what you pay for. You will do the same with all the customers you… Financial Terms – United States An account on which a financial asset is credited or can be credited, pursuant to an agreement under which the financial institution that manages the account undertakes to consider as legitimate the person for whom the account is held…

Law Dictionary (a) enter into a written security agreement executed by the mortgaged pledgor of the title account; and on the reference date, the custodian will credit the Q-REMIC shares designated pursuant to clause c and the Q-REMIC interest account, pursuant to clause (c).

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