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Illinois Compiled Statutes

810 ILCS 5/9-203 (2026)

Attachment and enforceability of security interest; proceeds; supporting obligations; formal requisites

✓ current as of May 2026
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(810 ILCS 5/9-203) (from Ch. 26, par. 9-203)
    Sec. 9-203. Attachment and enforceability of security interest; proceeds; supporting obligations; formal requisites.
    (a) Attachment. A security interest attaches to collateral when it becomes enforceable against the debtor with respect to the collateral, unless an agreement expressly postpones the time of attachment.
    (b) Enforceability. Except as otherwise provided in subsections (c) through (i), a security interest is enforceable against the debtor and third parties with respect to the collateral only if:
        (1) value has been given;
        (2) the debtor has rights in the collateral or the
    
power to transfer rights in the collateral to a secured party; and
        (3) one of the following conditions is met:
            (A) the debtor has signed a security agreement
        
that provides a description of the collateral and, if the security interest covers timber to be cut, a description of the land concerned;
            (B) the collateral is not a certificated security
        
and is in the possession of the secured party under Section 9-313 pursuant to the debtor's security agreement;
            (C) the collateral is a certificated security in
        
registered form and the security certificate has been delivered to the secured party under Section 8-301 pursuant to the debtor's security agreement;
            (D) the collateral is controllable accounts,
        
controllable electronic records, controllable payment intangibles, deposit accounts, electronic documents, electronic money, investment property, or letter-of-credit rights, and the secured party has control under Section 7-106, 9-104, 9-105A, 9-106, 9-107, or 9-107A pursuant to the debtor's security agreement; or
            (E) the collateral is chattel paper and the
        
secured party has possession and control under Section 9-314A pursuant to the debtor's security agreement.
    (c) Other UCC provisions. Subsection (b) is subject to Section 4-210 on the security interest of a collecting bank, Section 5-118 on the security interest of a letter-of-credit issuer or nominated person, Section 9-110 on a security interest arising under Article 2 or 2A, and Section 9-206 on security interests in investment property.
    (d) When person becomes bound by another person's security agreement. A person becomes bound as debtor by a security agreement entered into by another person if, by operation of law other than this Article or by contract:
        (1) the security agreement becomes effective to
    
create a security interest in the person's property; or
        (2) the person becomes generally obligated for the
    
obligations of the other person, including the obligation secured under the security agreement, and acquires or succeeds to all or substantially all of the assets of the other person.
    (e) Effect of new debtor becoming bound. If a new debtor becomes bound as debtor by a security agreement entered into by another person:
        (1) the agreement satisfies subsection (b)(3) with
    
respect to existing or after-acquired property of the new debtor to the extent the property is described in the agreement; and
        (2) another agreement is not necessary to make a
    
security interest in the property enforceable.
    (f) Proceeds and supporting obligations. The attachment of a security interest in collateral gives the secured party the rights to proceeds provided by Section 9-315 and is also attachment of a security interest in a supporting obligation for the collateral.
    (g) Lien securing right to payment. The attachment of a security interest in a right to payment or performance secured by a security interest or other lien on personal or real property is also attachment of a security interest in the security interest, mortgage, or other lien.
    (h) Security entitlement carried in securities account. The attachment of a security interest in a securities account is also attachment of a security interest in the security entitlements carried in the securities account.
    (i) Commodity contracts carried in commodity account. The attachment of a security interest in a commodity account is also attachment of a security interest in the commodity contracts carried in the commodity account.
(Source: P.A. 103-1036, eff. 1-1-25.)

    
Notes of Decisions
Cited in 26 cases (3 in the last 5 years), 1996–2022 · leading case: Barnes v. Nw. Repossession, LLC, 210 F. Supp. 3d 954 (N.D. Ill. 2016).
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Barnes v. Nw. Repossession, LLC, 210 F. Supp. 3d 954 (N.D. Ill. 2016). “]” 5 810 ILCS 5/9-203(b)(3)(A). Moreover, Austin’s transaction with Plaintiff is also “subject to other applicable laws relating to consumers,” id.”
Drobny v. JP Morgan Chase Bank, NA, 929 F. Supp. 2d 839 (N.D. Ill. 2013). “’ When indorsed in blank, an instrument becomes payable to bearer and may be negotiated by transfer of possession alone until specially indorsed.”
Miwel, Inc. v. Kanzler, 2019 IL App (2d) 180931 (Ill. App. Ct. 2019). “Citing section 9-203(b) of the UCC (810 ILCS 5/9-203(b) (West 2016)), the trial court concluded that the effectiveness of the security interest depended on the existence of a written security agreement.”
Malek v. Gold Coast Exotic Imports, LLC, 2018 IL App (1st) 171459 (Ill. App. Ct. 2018). · cites it 2× “810 ILCS 5/9-203(b) (West 2016). ¶ 20 Applying the above-stated factors to this case, we conclude that the agreement between Michel and Gold Coast created a valid security interest.”
In Re Com. Loan Corp., 316 B.R. 690 (Bankr. N.D. Ill. 2004). “810 ILCS 5/9-203(b)(3)(B) (2002); see generally 4 J.”
Illini Bank v. Clark (In Re Snyder), 436 B.R. 81 (Bankr. C.D. Ill. 2010). · cites it 2× “810 ILCS 5/9-203(b)(3)(A). Authenticate means “to sign.”
Marquette Bank Illinois v. Covey (In Re Classic Coach Interiors, Inc.), 290 B.R. 631 (Bankr. C.D. Ill. 2002). “It is axiomatic that a party granting a security interest has the power to do so only with respect to property in which it has an interest and then, only to the extent of its interest.”
Dilbay v. Demir (In re Demir), 500 B.R. 913 (Bankr. N.D. Ill. 2013). “810 ILCS 5/9-308 (perfection of a security agreement requires “attachment”); 810 ILCS 5/9-203(b) (requirements for attachment); See In re Outboard Marine Corp.”
In Re Weiss, 376 B.R. 867 (Bankr. N.D. Ill. 2007). “§ 9-203(b)(2), (b)(3); 810 ILCS 5/9-203(b) and the Official Comment, which explains in part: Creation, Attachment, and Enforceability.”
Firstar Bank Burlington, N.A. v. Stark Agric. Servs., Inc. (In Re Kevin W. Emerick Farms, Inc.), 201 B.R. 790 (Bankr. C.D. Ill. 1996). “810 ILCS 5/9-203(l)(a). STARK argues that when KEVIN signed the security agreement he intended to sign on behalf of SIMON KENTON.”
First Midwest Bank v. Reinbold (In re I80 Equip., LLC), 591 B.R. 353 (Bankr. C.D. Ill. 2018). “The requirement that the security agreement reasonably describe the collateral serves an evidentiary purpose, that is to create an enforceable security interest in clearly identified property of the debtor and to set forth enforceable contract terms and covenants respecting that…”
Heartland Bank & Trust Co. v. The Leiter Grp., 2014 IL App (3d) 130498 (Ill. App. Ct. 2014). “810 ILCS 5/9-203(b)(3A) (West 2010). A security interest attaches when the debtor obtains rights in its accounts receivable.”
Show all 26 citing cases →
— 810 ILCS 5/9-203(1)(a) — 2 cases
In Re Otto Farms, Inc., 247 B.R. 757 (Bankr. C.D. Ill. 2000).
In Re Klaus, 247 B.R. 761 (Bankr. C.D. Ill. 2000).
— 810 ILCS 5/9-203(a) — 2 cases
Sullivan v. United States (In Re Hulett Corp.), 389 B.R. 610 (Bankr. N.D. Ill. 2008).
White v. Funeral Fin. Sys., Ltd, 2022 IL App (1st) 201385-U (Ill. App. Ct. 2022).
— 810 ILCS 5/9-203(b) — 9 cases
Miwel, Inc. v. Kanzler, 2019 IL App (2d) 180931 (Ill. App. Ct. 2019). “Citing section 9-203(b) of the UCC (810 ILCS 5/9-203(b) (West 2016)), the trial court concluded that the effectiveness of the security interest depended on the existence of a written security agreement.”
Dilbay v. Demir (In re Demir), 500 B.R. 913 (Bankr. N.D. Ill. 2013). “810 ILCS 5/9-308 (perfection of a security agreement requires “attachment”); 810 ILCS 5/9-203(b) (requirements for attachment); See In re Outboard Marine Corp.”
In Re Weiss, 376 B.R. 867 (Bankr. N.D. Ill. 2007). “§ 9-203(b)(2), (b)(3); 810 ILCS 5/9-203(b) and the Official Comment, which explains in part: Creation, Attachment, and Enforceability.”
Malek v. Gold Coast Exotic Imports, LLC, 2018 IL App (1st) 171459 (Ill. App. Ct. 2018). “810 ILCS 5/9-203(b) (West 2016). ¶ 20 Applying the above-stated factors to this case, we conclude that the agreement between Michel and Gold Coast created a valid security interest.”
CNH Capital Am. LLC v. Trainor Grain & Supply Co. (In re Printz), 478 B.R. 876 (Bankr. C.D. Ill. 2012).
— 810 ILCS 5/9-203(b)(3)(A) — 4 cases
Barnes v. Nw. Repossession, LLC, 210 F. Supp. 3d 954 (N.D. Ill. 2016). “]” 5 810 ILCS 5/9-203(b)(3)(A). Moreover, Austin’s transaction with Plaintiff is also “subject to other applicable laws relating to consumers,” id.”
Illini Bank v. Clark (In Re Snyder), 436 B.R. 81 (Bankr. C.D. Ill. 2010). “810 ILCS 5/9-203(b)(3)(A). Authenticate means “to sign.”
Covey v. Morton Cmty. Bank (In Re Sabol), 337 B.R. 195 (Bankr. C.D. Ill. 2006).
Heartland Bank & Trust Co. v. Leiter Grp., 2014 IL App (3d) 130498 (Ill. App. Ct. 2014).
— 810 ILCS 5/9-203(b)(3)(B) — 1 case
In Re Com. Loan Corp., 316 B.R. 690 (Bankr. N.D. Ill. 2004). “810 ILCS 5/9-203(b)(3)(B) (2002); see generally 4 J.”
— 810 ILCS 5/9-203(b)(3A) — 1 case
Heartland Bank & Trust Co. v. The Leiter Grp., 2014 IL App (3d) 130498 (Ill. App. Ct. 2014). “810 ILCS 5/9-203(b)(3A) (West 2010). A security interest attaches when the debtor obtains rights in its accounts receivable.”
— 810 ILCS 5/9-203(d)(l) — 1 case
Illini Bank v. Clark (In Re Snyder), 436 B.R. 81 (Bankr. C.D. Ill. 2010). “810 ILCS 5/9-203(b)(3)(A). Authenticate means “to sign.”
— 810 ILCS 5/9-203(g) — 2 cases
Drobny v. JP Morgan Chase Bank, NA, 929 F. Supp. 2d 839 (N.D. Ill. 2013). “’ When indorsed in blank, an instrument becomes payable to bearer and may be negotiated by transfer of possession alone until specially indorsed.”
Malek v. Gold Coast Exotic Imports, LLC, 2018 IL App (1st) 171459 (Ill. App. Ct. 2018). “810 ILCS 5/9-203(b) (West 2016). ¶ 20 Applying the above-stated factors to this case, we conclude that the agreement between Michel and Gold Coast created a valid security interest.”
— 810 ILCS 5/9-203(l) — 1 case
Marquette Bank Illinois v. Covey (In Re Classic Coach Interiors, Inc.), 290 B.R. 631 (Bankr. C.D. Ill. 2002). “It is axiomatic that a party granting a security interest has the power to do so only with respect to property in which it has an interest and then, only to the extent of its interest.”
— 810 ILCS 5/9-203(l)(a) — 2 cases
Firstar Bank Burlington, N.A. v. Stark Agric. Servs., Inc. (In Re Kevin W. Emerick Farms, Inc.), 201 B.R. 790 (Bankr. C.D. Ill. 1996). “810 ILCS 5/9-203(l)(a). STARK argues that when KEVIN signed the security agreement he intended to sign on behalf of SIMON KENTON.”
Mercantile Bank v. Norville (In Re Norville), 248 B.R. 127 (Bankr. C.D. Ill. 2000).
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