A security interest in an aircraft engine can be perfected only in the manner required by federal law. Federal law excludes by preemption the recording of title to or liens against aircraft, so that a transfer that is not recorded under the federal system is not effective. Security Interests in Engines less than 550 horsepower are not eligible for recording. A security interest in an aircraft is perfected by filing with the Aircraft Registration Branch of the Federal Aviation Administration.
Title: Understanding the Harris Texas Security Agreement Granting Security Interest in Aircraft Engine Introduction: The Harris Texas Security Agreement Granting Security Interest in Aircraft Engine is an essential legal document that helps protect the interests of parties involved in aviation transactions. It establishes and defines the rights and responsibilities of the lender and borrower, ensuring the safety and enforceability of loans and collateral agreements related to aircraft engines. This article aims to provide a detailed description of the Harris Texas Security Agreement Granting Security Interest in Aircraft Engine, covering its purpose, key components, and types. Keywords: Harris Texas, security agreement, granting security interest, aircraft engine, collateral, lender, borrower, enforceability, aviation transactions. 1. Purpose of the Harris Texas Security Agreement: The Harris Texas Security Agreement is a legally binding contract that ensures the lender's right to possess and sell the borrower's interest in an aircraft engine in case of default or non-compliance with loan obligations. 2. Key Components of the Security Agreement: a. Loan Definitions: The agreement outlines the specifics of the loan, including the loan amount, interest rate, repayment terms, and other relevant financial details. b. Security Interest Granting: The borrower grants the lender a security interest in the aircraft engine(s) as collateral. c. Default and Remedies: The agreement clearly defines default circumstances and outlines the remedies available to lenders, including repossession, liquidation, and sale of the collateral. d. Indemnification: The agreement may include provisions to protect the lender against liability claims arising from the use, damage, or maintenance of the engine. 3. Different Types of Harris Texas Security Agreements Granting Security Interest in Aircraft Engine: a. Purchase Money Security Agreement (PSA): This type of security agreement applies to cases where the creditor provides the funds for the purchase of the aircraft engine. The lender's security interest extends to both the engine and any proceeds derived from its sale. b. Non-Purchase Money Security Agreement (NP MSA): In cases where a loan is provided for purposes other than the engine's purchase, an NP MSA is used. The lender's security interest is generally limited to the collateral itself, not extending to proceeds from its sale. c. Senior and Subordinate Security Interests: In situations where multiple lenders have security interests in the same aircraft engine, their agreements may establish a seniority order regarding the priority of collecting proceeds in case of default. Conclusion: The Harris Texas Security Agreement Granting Security Interest in Aircraft Engine plays a crucial role in protecting the interests of lenders and borrowers in aviation transactions involving engines. By understanding this document's purpose, key components, and different types, parties can ensure compliance, enforceability, and smooth execution of agreements related to aircraft engine loans. Keywords: Harris Texas, security agreement, granting security interest, aircraft engine, collateral, lender, borrower, enforceability, aviation transactions.Title: Understanding the Harris Texas Security Agreement Granting Security Interest in Aircraft Engine Introduction: The Harris Texas Security Agreement Granting Security Interest in Aircraft Engine is an essential legal document that helps protect the interests of parties involved in aviation transactions. It establishes and defines the rights and responsibilities of the lender and borrower, ensuring the safety and enforceability of loans and collateral agreements related to aircraft engines. This article aims to provide a detailed description of the Harris Texas Security Agreement Granting Security Interest in Aircraft Engine, covering its purpose, key components, and types. Keywords: Harris Texas, security agreement, granting security interest, aircraft engine, collateral, lender, borrower, enforceability, aviation transactions. 1. Purpose of the Harris Texas Security Agreement: The Harris Texas Security Agreement is a legally binding contract that ensures the lender's right to possess and sell the borrower's interest in an aircraft engine in case of default or non-compliance with loan obligations. 2. Key Components of the Security Agreement: a. Loan Definitions: The agreement outlines the specifics of the loan, including the loan amount, interest rate, repayment terms, and other relevant financial details. b. Security Interest Granting: The borrower grants the lender a security interest in the aircraft engine(s) as collateral. c. Default and Remedies: The agreement clearly defines default circumstances and outlines the remedies available to lenders, including repossession, liquidation, and sale of the collateral. d. Indemnification: The agreement may include provisions to protect the lender against liability claims arising from the use, damage, or maintenance of the engine. 3. Different Types of Harris Texas Security Agreements Granting Security Interest in Aircraft Engine: a. Purchase Money Security Agreement (PSA): This type of security agreement applies to cases where the creditor provides the funds for the purchase of the aircraft engine. The lender's security interest extends to both the engine and any proceeds derived from its sale. b. Non-Purchase Money Security Agreement (NP MSA): In cases where a loan is provided for purposes other than the engine's purchase, an NP MSA is used. The lender's security interest is generally limited to the collateral itself, not extending to proceeds from its sale. c. Senior and Subordinate Security Interests: In situations where multiple lenders have security interests in the same aircraft engine, their agreements may establish a seniority order regarding the priority of collecting proceeds in case of default. Conclusion: The Harris Texas Security Agreement Granting Security Interest in Aircraft Engine plays a crucial role in protecting the interests of lenders and borrowers in aviation transactions involving engines. By understanding this document's purpose, key components, and different types, parties can ensure compliance, enforceability, and smooth execution of agreements related to aircraft engine loans. Keywords: Harris Texas, security agreement, granting security interest, aircraft engine, collateral, lender, borrower, enforceability, aviation transactions.
