A floating lien is a security interest in property that was not in the possession of the debtor when the security agreement was executed.

Name: A floating lien is a security interest in property that was not in the possession of the debtor when the security agreement was executed.
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A floating lien allows the debtor to continue to use or sell the property, while giving the creditor a security interest in it. It applies to property that is subject to change, such as inventory or accounts receivable.

A Floating Lien Is a Security Interest in Property That